SunSirs: The Domestic Methanol Market is Showing Signs of Recovery

According to the SunSirs: Commodity Market Analysis System, from July 28th to 31st (as of 3:00 PM), domestic methanol market quotes at ports in East China rose from 2,394 RMB/ton, then fell to around 2,380 RMB/ton. This marked a 0.59% decrease over the period, a 5.99% month-over-month decline, and a 5.18% year-over-year decline. The domestic methanol market is showing signs of recovery. Northwest olefins plants are increasing external procurement, coupled with favorable factors such as ongoing maintenance at some units and low inventories. Upstream companies are holding prices for shipments, and downstream companies are passively following suit.

As of the close of August 1st, the closing price of methanol futures on the Zhengzhou Commodity Exchange fell. The main methanol futures contract, 2509, opened at 2,403 RMB/ton, reaching a high of 2,417 RMB/ton and a low of 2,385 RMB/ton. It closed at 2,393 RMB/ton, down 19 RMB, or 0.79%, from the previous day's settlement. Trading volume was 505,219 lots, with open interest of 533,076, representing a daily increase of -31,338.

As of August 1st, methanol market prices by region are as follows:

On the cost side, coal supply has slightly decreased, but the impact is limited. Demand is releasing slowly, and costs remain weak. Methanol costs are being impacted by relatively negative factors.

On the demand side, glacial acetic acid prices fluctuated, with Northwest factories raising prices by 50 RMB/ton. Formaldehyde: The formaldehyde market remained stable. Raw material methanol strengthened, leading to increased costs. Dimethyl ether: The dimethyl ether market remained stable. Most downstream products rose due to rising methanol prices, and methanol demand was positively impacted by relatively positive factors.

On the supply side, Shanghai Huayi and Xinjiang Zhongtai plants underwent maintenance, while Gansu Liuhua, Gengyang New Energy, and Xinjiang Zhongtai plants resumed operations. Overall, the restored capacity exceeded the lost capacity, leading to an increase in capacity utilization. Methanol supply was impacted by negative factors.

On the international market, as of the close of July 30, the CFR Southeast Asia methanol market closed at $332.50-333.50/ton. The US Gulf methanol market closed at 95-96 cents/gal, down 1 cent/gal. The FOB Rotterdam methanol market closed at 245.5-246.5 euros/ton, up 7 euros/ton.

Market outlook: Companies are clearly willing to maintain prices, but traditional downstream players are resistant to continued price increases, which has limited potential for price increases. Methanol analysts at SunSirs: predict that the domestic methanol spot market is expected to consolidate with a relatively strong trend.

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