China Methanol Price Rebounds amid Multiple Supports
China’s coastal methanol market rebounded last week. Taking the spot price in Taicang as an example, it rose from RMB 2,392.5/mt on Monday (April 10) to RMB 2,477.5/mt on Friday (April 14), up RMB 85/mt or 3.55%. Both the spot and futures markets went up amid multiple favorable factors such as the shift of dominant contract, unexpected maintenance of overseas units, pre-holiday downstream restocking, etc. From late April to May, methanol prices may keep stable-to-rising, considering the restart of some CTO/MTO units and the reduction of total supply.
There were intensive bullish factors in the market during this period.
April 7: Domestic coal prices dropped; the methanol prices in Europe and the U.S. dropped to new lows.
April 10: Marjan’s methanol units were shut down unexpected; some units in Henan and Shandong were scheduled to restart from maintenance in late April.
April 11: Merchantable resources were expected to decrease with two vessels of polluted imported cargoes forbidden to be unloaded in Taicang; one 1,670kt/a methanol unit in Ningxia was shut down for maintenance.
April 12: Petronas’ two units were closed; CTO/MTO plants in Inner Mongolia and Shandong began feedstock purchases; the methanol prices in the U.S. stopped falling with more sales.
April 13: The methanol prices in Southeast Asia rose on expected supply reduction; port inventory dropped on short-covering and pre-holiday stockpiling demand.
April 14: Non-Iranian cargoes were predicted to decline in May; the methanol prices rebounded in Europe and the U.S.
On the whole, the influence from feedstock prices faded, while the changes in supply-demand and the decline in futures positions were the decisive factors for the market rebound. It is predicted that the spot methanol prices in Taicang will fluctuate in the range of RMB 2,450-2,550/mt in the near term on the back of expected supply reduction and demand growth. Market players are suggested to pay attention to the operating rate at important downstream plants and the shipment & unloading of imported cargoes.
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