Methanol Market Trends in China

August 8th News

According to the commodity market analysis system, from August 4 to August 8 (up to 15:00), the quotation for methanol in the East China port of the Chinese market rose and then fell from 2,375 CNY/ton to around 2,378 CNY/ton. During this period, the price increased by 0.11%, decreased by 1.31% month-over-month, and decreased by 3.78% year-over-year. The Chinese methanol market was mainly on the rise, with local supply maintenance and increased olefin production in the domestic market. Under the background of low inventory in enterprises, the available supply in the market was tight, leading to a situation where companies were holding back sales at higher prices. Traders, influenced by the rising prices, actively followed the trend, while downstream buyers were forced to purchase at high prices.

As of the close on August 8, methanol futures prices on the Zhengzhou Commodity Exchange declined. The main methanol futures contract (2509) opened at 2391 CNY/ton, reached a high of 2399 CNY/ton and a low of 2378 CNY/ton, and closed at 2383 CNY/ton in the late trading session, down 12 CNY/ton from the previous trading day's settlement price, representing a price decrease of 0.50%. Trading volume was 299,310 contracts, open interest stood at 407,074 contracts, with an increase of -29,603 contracts for the day.

Methanol Spot and Futures Comparison Chart:

As of August 8, the summary of methanol market prices in various regions of China:

Cost aspect, the contraction in coal supply dominates the market, with coal prices continuing to rise, strengthening the support from the cost aspect. The cost aspect for methanol is influenced by positive factors.

Coal/Steam Coal (Upstream Raw Material) - Methanol Price Trend Comparison Chart:

Demand Side: Glacial acetic acid: The market price of glacial acetic acid is mostly stable. Overall factory shipments are moderate, and traders as well as downstream users mainly replenish stocks according to demand, resulting in a generally subdued trading atmosphere. Formaldehyde: The formaldehyde market shows stability with upward trends. Raw material methanol prices have risen, prompting factories in major producing areas to passively increase prices due to rising costs, while downstream demand remains weak. Dimethyl ether: The dimethyl ether market is consolidating sideways. Raw material methanol prices in major producing regions have slightly increased, continuing to strengthen costs. Demand for dimethyl ether in China is relatively sluggish, with weak purchasing support. Most downstream products have risen due to the impact of increasing methanol prices, indicating that the demand side for methanol remains favorable.

Methanol-Acetic Acid (Downstream Product) Price Trend Comparison Chart:

Methanol-MTBE (downstream product) price trend comparison chart:

Supply side, Shaanxi Runzhong (Changwu), Ningxia Baofeng, Hualu Hengsheng, Inner Mongolia ENN, and Shaanxi Changqing are undergoing plant maintenance; Yunnan Pioneer has reduced production; Xinjiang Guanghui, Gansu Huating, and Shaanxi Xinghua have resumed operations. Overall, the amount of lost capacity exceeds the amount of restored capacity, leading to a decrease in the capacity utilization rate. The supply side of methanol is influenced by favorable factors.

Regarding overseas markets, as of the close on August 7, the CFR Southeast Asia methanol market closed at USD 332.5-333.5 per ton. The US Gulf methanol market closed at 95-96 cents per gallon; the FOB Rotterdam methanol market closed at EUR 268.5-269.5 per ton, up by EUR 7 per ton.

Looking ahead, port inventories are expected to accumulate, maintenance shutdowns at domestic methanol enterprises will gradually resume, and increased external procurement of olefins will provide stronger support for demand, making price increases more evident. Methanol analysts predict that China's spot methanol market is likely to consolidate with a bullish trend.