SunSirs: China Methanol Market Prices Fluctuate Within a Narrow Range

According to the SunSirs Commodity Market Analysis System, from April 6 to April 13 (as of 15:00), quotes for domestic methanol at East China ports initially rose before falling back to the vicinity of 3,360 RMB/ton, starting from 3,490 RMB/ton. During this period, prices declined by 3.72%, while rising 18.62% month-on-month and 35.39% year-on-year. Trading in the domestic methanol market remains primarily influenced by geopolitical factors, with rising sentiment in the futures market gradually filtering through to the spot market. Bolstered by favorable factors—including continuous inventory reduction by enterprises, localized rigid demand for external olefin procurement, and a gradual recovery in downstream demand—methanol prices have exhibited a trend of significant upward surges.

As of the close on April 13, methanol futures on the Zhengzhou Commodity Exchange settled higher. The main methanol futures contract (2605) opened at 3,089 RMB/ton, reached a high of 3,300 RMB/ton, and hit a low of 3,043 RMB/ton, before closing at 3,175 RMB/ton. This represented an increase of 27 points—or 0.86%—compared to the previous trading day's settlement price. Trading volume stood at 1,584,666 lots, open interest at 361,418 lots, and daily open interest change at -56,991 lots.

Regarding costs: The overall supply of coal remains stable, and with downstream purchasing enthusiasm remaining subdued, coal prices have held steady; consequently, the cost side of the market remains stable. The impact from the cost perspective presents a mixed picture—neither entirely bullish nor bearish.

Regarding demand: From the downstream perspective, methanol prices have continued their sharp upward trajectory. Although some price retracement has occurred, the weekly average price remains at a high level. Consequently, some downstream industries are struggling to keep pace with the price increases, and negative feedback from terminal product markets is becoming increasingly severe, leading to an involuntary squeeze on production margins for most downstream sectors. As the majority of downstream products are sensitive to methanol pricing, the demand side of the methanol market is currently influenced by factors that lean slightly bullish.

Regarding supply: Production facilities at Shanxi Jiaohua, Xinxiang Zhongxin, Jingmen Yingde, Shenhua Ningmei, and Yunnan Yuntianhua have undergone maintenance shutdowns. Conversely, facilities at Inner Mongolia Xinhang, Jiutai New Materials, and Inner Mongolia Hebaitai have resumed operations. Overall, the volume of resumed production exceeds the volume of lost production, resulting in an increase in total output and a rise in capacity utilization rates. Consequently, the supply side of the methanol market is currently influenced by factors that lean slightly bearish. On the international front, as of the close on April 10, the CFR Southeast Asia methanol market settled at $679–681 per ton, down $10 per ton. The FOB US Gulf methanol market closed at 141–143 cents per gallon; meanwhile, the European FOB Rotterdam methanol market settled at €510–512 per ton, a decline of €9 per ton.

Regarding the market outlook, supported by fundamentals such as a tight supply-demand balance and continued inventory destocking, prices—while seeing a slowdown in the pace of their ascent—are expected to maintain a generally firm trajectory. All things considered, analysts at SunSirs anticipate that the domestic spot methanol market will primarily exhibit a trend of strong consolidation.

SunSirs has been continuously tracking price data for over 200 commodities for nearly 20 years, please contact support@sunsirs.com for subscription.