SunSirs: China Methanol Market Fluctuations and Consolidation

According to the Commodity Market Analysis System of SunSirs, from September 16th to 20th (as of 15:00), the average price of methanol in East China ports in the domestic market increased from 2,401 RMB/ton to 2,410 RMB/ton, with a price increase of 0.35% during the period, a month on month decrease of 1.70%, and a year-on-year decrease of 6.10%. Domestic methanol production continues to rise, and some methanol production enterprises have pre holiday inventory demand. However, downstream and trading companies have a generally wait-and-see attitude towards restocking, with production enterprises mainly lowering their quotations and shipping. The domestic methanol market atmosphere is average.

As of the close on September 20th, the closing price of methanol futures on Zhengzhou Commodity Exchange has fallen. The main contract 2501 for methanol futures opened at 2,411 RMB/ton, with a highest price of 2,412 RMB/ton and a lowest price of 2,376 RMB/ton. It closed at 2,382 RMB/ton in the closing session, a decrease of 3% or 0.13% compared to the previous trading day's settlement. The trading volume was 550,688 lots, the position was 791,,242 lots, and the daily increase was 21,019.

On the cost side, the sales situation of coal mines is average, and some coal mines with high inventory pressure have begun to slightly lower the prices at the pit mouth. With the stable prices of large coal enterprises' external purchases, local coal plants and traders have a relatively calm sentiment towards the future market, and the prices at the production site have remained stable overall. The impact of methanol cost is mixed.

On the demand side, downstream MTBE: Huntsman is starting production, and MTBE demand is increasing; The mainstream chloride factories in East China have a parking and maintenance plan, which reduces the demand for methanol; Downstream acetic acid: Sop, Great Wall, and Longyu facilities are about to resume full load operation, resulting in increased demand for acetic acid; Downstream dimethyl ether: Qianjiang Jinhuarun plant briefly started operation, resulting in reduced demand for dimethyl ether; There is currently no plan to stop driving formaldehyde, and the demand fluctuation is not significant. The impact of methanol demand is mixed.

Supply side, maintenance of Shandong Rongxin equipment; Inner Mongolia Guotai equipment has been restored. The recovery amount exceeds the loss amount, and the capacity utilization rate increases. Negative factors affecting the methanol supply side.

In terms of external markets, as of the close of September 19th, the CFR Southeast Asian methanol market closed at $345.00- $346.00 per ton. The closing price of the US Gulf methanol market is 108.00-109.00 cents per gallon; The closing price of FOB Rotterdam methanol market is 349.50-350.50 euros/ton.

Market forecast shows sufficient supply and strong willingness of factories to ship before the holiday; In terms of demand, traditional downstream profits are average, and there is limited room for further demand growth. The methanol analyst from SunSirs predicts that the domestic methanol market situation may mainly consolidate.

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