SunSirs: China Methanol Market is Running weakly

According to the Commodity Market Analysis System of SunSirs, from August 5th to 9th (as of 10:00), the average price of methanol in East China ports in the domestic market fell from 2,490 RMB/ton to 2,460 RMB/ton, with a price increase of 0.60% during the period, a month on month decrease of 1.76%, and a year-on-year increase of 7.40%. The domestic methanol market is running weakly. The supply has increased, and the domestic methanol market has a strong mentality towards yeast storage. Demand continues to operate weakly, with some traders purchasing at low prices.

As of the close on August 9th, the closing price of methanol futures on Zhengzhou Commodity Exchange has risen. The main contract for methanol futures, 2409, opened at 2,495 RMB/ton, with a highest price of 2,516 RMB/ton and a lowest price of 2,487 RMB/ton. It closed at 2,505 RMB/ton at the end of the day, up 10 RMB/ton from the previous trading day's settlement, an increase of 0.40%. The trading volume was 491,828 lots, and the position was 626,831 lots, with a daily increase of -23,229.

In terms of cost and supply, most coal mines in the production area are currently maintaining normal production and sales, mainly relying on long-term cooperation to ensure supply, and conducting large-scale inspections of safety production hazards in some areas. The overall downstream demand is currently sluggish, and non electric terminals still maintain a small amount of transportation for essential needs. Coal plants and traders are cautious about purchasing, and market activity is weak. Sales in mining areas are generally flat, and most coal mine prices have not been adjusted yet. Some coal mines have increased their coal storage pressure, and prices have slightly decreased by 5-10 RMB/ton. The overall performance of coal prices in production areas is stagnant and weak. The impact of methanol cost is mixed.

On the demand side, downstream acetic acid: Tianjian is maintaining maintenance, while Texas Hualu and Anhui Huayi are expected to shut down, but Sopo is expected to resume full load operation, and the demand for acetic acid is not fluctuating significantly; Downstream formaldehyde: Environmental inspections in the main production areas have ended, leading to an increase in demand for methanol; Downstream chloride: The maintenance of the Quzhou Juhua plant has not been restored, and the mainstream factories in Shandong are slowly increasing their load, which may increase the demand for chloride; Downstream dimethyl ether: Henan Yima plant restarts, increasing demand for dimethyl ether; Downstream MTBE: Huntsman has maintenance plans in place, resulting in reduced MTBE demand. The impact of methanol demand is mixed.

Supply side, maintenance of Jiangsu Sopo and Shanxi Junjie equipment; Shanxi Lubao plant reduces production; Xinxiang Zhongxin, Shaanxi Runzhong (Changwu), Shaanxi Changqing, Xinjiang Xinye, Jiangsu Sopu, Jiutai New Materials (Tuoxian), Yunnan Yuntianhua plant restoration. The recovery amount exceeds the loss amount, resulting in an increase in capacity utilization rate. Negative factors affecting the methanol supply side.

In terms of external markets, as of the close of August 7th, the closing price of CFR Southeast Asia methanol market was 346.00-347.00 US dollars per ton. The closing price of the US Gulf methanol market is 100.00-101.00 cents per gallon; The closing price of FOB Rotterdam methanol market is 322.00-323.00 euros/ton, up 4 euros/ton.

In the future market forecast, supply will continue to increase, and there will still be sufficient circulating goods at ports. However, downstream production is not high, and demand remains weak, with obvious weakness in spot driving. SunSirs's methanol analyst predicts that the domestic methanol market will continue to be weak.

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