Risk Hints in Methanol Market
March 8, 2018
In early week,the futures price of methanol rose, while that of spotgoods declined. On April 23rd, methanol price in Shandong, Hebei, Henan declined by CNY100/mt. The guiding price of methanol in production areas rose, pushed up by strong olefin demand. The price of methanol at East China and South China ports rose slightly amid high futures price and low storage. On April 24th, the downstream users’bidding price in Northern Shandong rose to CNY2,880-2,900/mt. The price of methanol in production areas went range-bound, and that of methanol at the port continuously rose.
The overseas units overhaul continuously supported China methanol market. The 1,650,000 mt/yr unit at Iran ZPC shut down on April 28thfor one-week maintenance and its another set of unit will take maintenance from April 28th to mid May. The 1,000,000 mt/yr unit at FPC took 20-30 days of maintenance from April 20th. The 1.650,000 mt/yr unit at Oman Salalah took 30 days of maintenance from April 1st. The 750,000 mt/yr unit will take maintenance. Brunei unit restarted. In Northwest China, the olefin unit at Shenhua Yulin will restart on April 25th or April 26th, and Shenhua Baotou will purchase methanol from the market, which will support the methanol price in production areas. In addition, the run rates of some methanol production units in Guanzhong, northern Jiangsu and North China were still low, and some units shut down amid environmental inspection.
According to JLC, some MTO enterprises in mainland and port have maintenance plans, which will further drag down the methanol market. Meanwhile, the maintenance of olefin units at the ports will bring to a purchasing volume loss of 190,000 mt for methanol.
For newly built units,from January to April 2018, the 2 units at Shandong New Energy Phoenix Tengzhou Energy and Jinneng Technology restarted. In May, the 2 units of Haoyuan Chemical and Inao Group will start. After the Larbor’s Day, the methanol supply will be limited amid low arrival of shiploads, supporting the methanol market. Besides, market players need to pay attention to methanol price in mainland.
Overall, China’s methanol price will go range-bound in the short time, and the price of methanol will be significantlyvaried from place to place. Market players need to pay attention to the upcoming risk of purchasing volume loss.