Since September, the overall load of international methanol plant declined, mainly in Iran, Saudi Arabia and other Middle East countries caused by centralized maintenance of methanol production. It is understood that the first two units of Oman holiday, Iran ZPC equipment and the temporary stop, still has an annual output of 1 million tons of equipment maintenance in Saudi arabia. Overall, the Middle East is in a tight situation in the supply of methanol. In the Middle East due to the production of methanol with natural gas as raw material, low cost, and China methanol imported mostly from the middle east. Therefore, with the area of methanol plant parking, load reduction, methanol supply low cost in China is short sight.

Not only that, Southeast Asian countries also have a methanol production plant centralized maintenance phenomenon. Since September, Brunei BMC 850 thousand tons of equipment to stop, and Indonesia also had a device in mid October to overhaul, at present Malaysia still has an annual output of 1 million 700 thousand tons of the device in the parking. Because of China’s Malaysia methanol output is relatively large, so the decrease in outer supply traders reluctant to sell under the background of mood enhancement, promote Chinese methanol CFR offer in nearly one and a half to rally. Data show that as of Friday, CFR China methanol to offer up to $275 U.S. dollars / ton, compared to mid September 230 dollars / ton, up 19.57%.

The domestic coal supply tight situation is still difficult to improve

As for coal to methanol based China, on the supply side structural reform under the background of this year, coal prices continued to rise, resulting in downstream coal chemical methanol prices rose to benefit. Despite the end of the month, the Commission decided to convene an emergency meeting of the advanced part of the coal production release, but because the market demand, and actively buying power, production supply is too slow, and limit the capacity of line maintenance, due to the policy effect is difficult in the short term, the coal market tight situation has not yet appeared. This led to the current coal prices still continue strong rise posture, and the downstream methanol to form a strong supporting role in the cost, so as to stimulate the price in compensatory growth market.

In conclusion, the current external methanol supply tight situation is difficult to improve in the short term, while domestic coal to methanol by cost factors supporting, still continue to rise in power. Although the overseas financial market risk aversion rising, but with the fundamentals of good environment, is expected to still have room to rise again in methanol.