Supply Tightness at Home and Abroad Pushed Up Methanol Prices

Supply Tightness at Home and Abroad Pushed Up Methanol Prices

Major Methanol Units Status Influencing U.S. Market

Major Methanol Units Status Influencing Europe Market

Normally, 47%-50% of the methanol resources from Trinidad are destined for the U.S. for arbitrage, and the left will be delivered to Europe and Asia. As for Egypt, 60%-70% of local methanol products are supplied to Europe.

From the two tables above we can see that the production of the major methanol units in the U.S. and Europe is not very stable recently. Local traders purchased actively for contract delivery, which pushed the methanol prices to keep rising from end-July to early September.

For other Asian areas, the large methanol unit of Petronas may be delayed to restart, and the production at BMC is still not stable. In addition, KMI’s methanol unit is also scheduled to take an overhaul. Thus, there is supply gap in SE Asia, Taiwan and South Korea, and the methanol prices are predicted to keep firm supported by the rigid demand.

The firm international markets, continuous depreciation of RMB and payment issues of Iranian cargoes all greatly support the imported methanol market in China. Although the deals of imported methanol are limited each week, the supply of merchantable forward month cargoes is extremely tight, which is the major reason for high imported methanol prices in China.

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