SunSirs: The Methanol Market Was Fluctuating Within a Narrow Range

Price trend

According to the SunSirs Commodity Market Analysis System, from April 6 to April 13 (as of 15:00), quotes for methanol at ports in East China—a key domestic market indicator—fluctuated, initially rising before falling back to the vicinity of 3,360 RMB/ton, down from 3,490 RMB/ton. Over this period, prices declined by 3.72%; however, they posted a month-on-month increase of 18.62% and a year-on-year increase of 35.39%. Trading in the domestic methanol market remains primarily driven by geopolitical factors, with bullish sentiment in the futures market gradually filtering through to the spot market. Bolstered by a confluence of positive factors—including continued 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 of trading on April 13, methanol futures on the Zhengzhou Commodity Exchange settled higher. The most active 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—an increase of 27 points (0.86%) compared to the previous trading day's settlement price. Trading volume stood at 1,584,666 lots, open interest was 361,418 lots, and daily open interest decreased by 56,991 lots.

Market analysis

Regarding the cost front, overall coal supply remains stable, while downstream purchasing enthusiasm is subdued; consequently, coal prices are holding steady, keeping the cost base stable. The impact from the cost side presents a mixed picture.

From the perspective of demand—specifically at the downstream end—methanol prices have continued their sharp upward trajectory. Although some retracement has occurred, the weekly average price remains at an elevated level. However, the downstream sector has shown limited capacity to keep pace with these rising costs, while negative feedback from end-products has become increasingly severe; consequently, production margins across most downstream industries have been involuntarily squeezed. As the majority of downstream products are sensitive to methanol pricing, the overall demand side for methanol provides bullish factors. 

On the supply side, facilities at Shanxi Coking, Xinxiang Zhongxin, Jingmen Yingde, Shenhua Ningmei, and Yunnan Yuntianhua are undergoing maintenance; meanwhile, facilities at Inner Mongolia Xinhang, Jiutai New Materials, and Inner Mongolia Hebaitai have resumed operations. Overall, the volume of restored production exceeds the volume of lost production, resulting in increased output and a rise in capacity utilization rates. Consequently, the methanol supply landscape provides bearish factors.

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 settled at 141–143 cents per gallon; the European FOB Rotterdam methanol market settled at €510–512 per ton, down €9 per ton.

Market outlook

Bolstered by fundamental factors—such as a tight supply-demand balance and a continued drawdown in inventories—prices, while seeing a slight slowdown in their rate of increase, generally maintain a firm trajectory. Overall, analysts at SunSirs anticipate that the domestic methanol spot market will primarily undergo a period of consolidation to be stronger.

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