Introduction: Methanol is a colorless and clear liquid, its vapor can form an explosive mixture with air, and when burned, it produces a blue flame. Methanol can be miscible with organic solvents such as water, ethanol, benzene, ketones, etc. Its vapor forms an explosive mixture with air, which can cause combustion and explosion when exposed to open flames and high heat energy. The methanol model monitored by SunSirs is superior.

Firstly, let's review the trend of the methanol market in 2023. The domestic methanol market experienced strong fluctuations in 2023, with an average price of 2,698 RMB/ton at the beginning of the year and 2,450 RMB/ton at the end of the year, a decrease of 20% throughout the year. From the trend chart of methanol prices, it can be seen that the highest point of methanol prices in 2023 occurred in late January, with a highest price of 2,808 RMB/ton. The lowest point of methanol prices occurred in mid June, with a lowest price of 2,016 RMB/ton and a maximum amplitude of 39.29%.

In 2023, the overall price of methanol was initially suppressed and then increased, while the cost of coal production fluctuated and fell. Freight costs remained stable after falling from high levels, and downstream olefin profits significantly recovered. The strength of traditional profits was clear; Domestic production capacity has increased, with low starting and high output, a significant year-on-year increase in imports, weak downstream demand followed by strong demand, coastal inventories rising and then falling, and mainland inventories falling and then stabilizing; The methanol market is expected to have a basic balance of supply and demand in 2024, and attention should be paid to seasonal, macro, and cost side impacts. Methanol will continue to fluctuate widely throughout the year.

In 2023, the overall price of methanol fell in the first half of the year, but rebounded after bottoming out in the second half, showing a V-shaped trend overall. After the Spring Festival, due to lower than expected downstream demand and consumption, coupled with loose coal costs, methanol prices have fallen from a high level. Starting from the second quarter, influenced by factors such as the Federal Reserve's interest rate hike, a sharp drop in coal production costs, and a surge in import volume, methanol prices accelerated their decline to a low point within the year, gradually stabilizing in mid June. In the third quarter, on the one hand, coal prices rose rapidly during the peak summer season, and the cost of methanol continued to rise. On the other hand, domestic macroeconomic and real estate policies were frequently favorable, driving a comprehensive increase in downstream demand for methanol. In addition, the suspension of interest rate hikes by the Federal Reserve after July has also enabled the recovery of overseas demand. In mid to late September, the continuously rising inventory triggered a high-level correction in methanol prices, coupled with a loosening of methanol costs, resulting in a weak methanol market. After November, with the decrease in temperature, the cost of coal production stabilized again, and the downstream demand level was relatively high. The low level of methanol regained support, with a focus on consolidation and oscillation.

In terms of supply, the domestic methanol production capacity reached 111.15 million tons in 2023, and the newly added methanol production capacity in China was 6.225 million tons in 2023. The newly added methanol units in 2023 mainly include 2.4 million tons from Baofeng, 800,000 tons from Hualu Hengsheng (Jingzhou), 600,000 tons from Inner Mongolia Guangju New Materials, 550,000 tons from Inner Mongolia Junzheng Chemical, and 400,000 tons from Alxa League Shanghai Mongolia Energy. It is expected to add 7.85 million tons of production capacity in 2024, including 6.6 million tons from Inner Mongolia Baofeng, 550,000 tons from Inner Mongolia Junzheng, 300000 tons from Henan Jinkai Chemical, and 400000 tons from Ningxia Guanneng. The domestic methanol production from January to November 2023 was 76.62 million tons, an increase of 3.84% year-on-year. The production is expected to increase simultaneously in 2024. The supply of methanol has further increased.

In terms of imports and exports, China's dependence on methanol imports is about 15% in 2023. From January to December 2023, the cumulative import volume of methanol in China was 14.553 million tons, a year-on-year increase of 19.36%. The cumulative export volume of methanol in China was 149,700 tons, a year-on-year decrease of 13.42%. In 2023, China's methanol import volume remained high. Since the stabilization of Iran's methanol plants in early March, the operating rate of overseas methanol plants has risen to a high level. At the same time, overseas methanol production capacity has been further released. In 2023, the overseas methanol production capacity was 1.815 million tons, and the overseas methanol supply volume has increased. Supported by import profits, the supply of methanol flowing into China has also increased.

In terms of demand, the apparent consumption of methanol in China reached 83 million tons in 2023, an increase of about 5% year-on-year. The largest downstream demand for methanol in China is methanol to olefins (MTO), which accounts for 52%; Traditional demand accounts for 19.55%, and the main downstream of methanol are acetic acid, MTBE, formaldehyde, dimethyl ether, DMF, as well as methanol fuel and others. There is currently no plan to increase production capacity for the main downstream MTO of methanol in 2024, and the growth rate of downstream MTO demand for methanol may slow down in 2024. In recent years, the operating rate of other traditional downstream methanol products has remained high, which has a stable driving effect on methanol consumption.

Looking ahead to 2024, methanol may exhibit a pattern of dual supply and demand growth. While supply remains high and demand growth may slow down to some extent, the methanol industry may still exhibit a slight fluctuation pattern in 2024.

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