Price trend:

According to the SunSirs' commodity market analysis system, from December 8th to December 17th (as of 3:00 PM), the domestic methanol market price at East China ports rose from 2,090 RMB/ton to around 2,140 RMB/ton, representing a 5.16% increase compared to the previous period and an 18.74% decrease year-on-year. Recently, the domestic methanol market has been supported by freight costs, leading to firm prices in some areas. However, the port market faced the dual pressure of high inventory levels and oversupply.

As of the close of trading on December 17th, the closing price of methanol futures on the Zhengzhou Commodity Exchange for the contract expiring on December 16, 2025, increased. The main methanol futures contract 2601 opened at 2,125 RMB/ton, reached a high of ,2171 RMB/ton, a low of 2,121 RMB/ton, and closed at 2,156 RMB/ton, an increase of 39 RMB/ton compared to the previous trading day's settlement price, representing a 1.84% increase. The trading volume was 904,393 lots, open interest was 874,732 lots, and the daily change in open interest was -21,895 lots.

Market Analysis

From a cost perspective, the fundamentals of the coal market remained relatively loose, leading to a downward shift in prices, which in turn weakened the cost support for methanol. The cost side of methanol is therefore provided bearish factors for the market.

On the demand side, downstream MTO (methanol-to-olefins) demand was weak, limiting the potential for overall demand growth. Profit margins in downstream industries may be under pressure. Most downstream products were affected by methanol prices, and the demand for methanol was negative for the market.

On the supply side, Shanxi Yaxin and Shaanxi Weihua's plants were undergoing maintenance; Chongqing Wanlilai's plant reduced production; and Jiutai New Materials' plant resumed operations.  Overall, the increase in production from resumed operations outweighed the losses from maintenance and reduced production, leading to an increase in capacity utilization. The statistics indicate fewer planned maintenance and production cuts in the next period, while more plants are expected to resume operations. Therefore, the overall market supply of methanol is likely to increase. The supply side of methanol proviede bearish factors for the market.

In the international market, as of the close of trading on December 16th, the CFR Southeast Asia methanol market closed at $316.5-317.5/ton. The FOB US Gulf methanol market closed at 87.5-88.5 cents/gallon, down 1 cent/gallon; the European FOB Rotterdam methanol market closed at €252.5-253.5/ton, down €1/ton.

Market Outlook

As of December 17, the domestic methanol market in mainland China was well-supplied. Coupled with relatively firm freight rates, upstream producers in the production areas were actively lowering prices to move inventory. Analysts at SunSirs expect the domestic methanol spot market to remain in a narrow range of consolidation and observation.

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