Oct-Nov China Methanol Import Interpretation & Forecast
According to SCI, China’s methanol import volume in October is estimated at 1,394kt, up 60.8kt or 4.56% M-O-M. Influenced by the weak demand in most overseas consumption markets, more cargoes from South America, U.S. and the Middle East flowed into China. Thereinto, most imported resources were consumed by downstream olefin plants.
In terms of import origin, the volume of methanol imported from a certain country in the Middle East, Trinidad, New Zealand, Chile and U.S. increased to 774.4kt, 177kt, 95kt, 78.6kt and 78kt respectively. However, there was basically no cargo from Malaysia this month, and the volume from a certain country in Europe decreased to 38kt, which was mainly influenced by unstable unit operation and logistics cost.
In terms of arrival area, the volume of methanol arrived in East China (Jiangsu and Zhejiang) and Tianjin increased M-O-M, while that in South China decreased. The volume of methanol flowing into five coastal MTO plants climbed to 897.4kt, up 24.66% M-O-M, and the volume took up 64.38% of the total imports. In October, these five MTO plants ran steadily most of the time, brining stable methanol demand. Later on a few MTO units are scheduled to cut or pause production, so surplus imports may be transferred to other downstream plants.
Forecast: Continuously high import cost has influenced the profitability of downstream products. By the end of October, the import cost has been RMB 108-115/mt higher than domestic spot prices. Most downstream plants are cautious about purchasing forward month arrival methanol, just maintaining feedstock inventory at 20-30 days. Entering H2 October, the methanol units in the Middle East have maintained stable operation, and the shipment has been accelerated notably. However, potential port congestion and demurrage may influence the actual unloading of cargoes to some extent. On the whole, it is predicted that China’s methanol import volume may be 1,340-1,360kt in November.
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