Insights on Methanol Price Movement

Methanol Prices in Southeast Asia edged high on 4 August as several manufacturers in eastern region reduced their plant operating rates due to prevailing demand uncertainties over several downstream commodities. However, overall Methanol consumption in the domestic market remained strong under its consistent demand from end-use industries like pharmaceuticals and chemicals. With traders offering the imported cargoes at an elevated rate due to the tight supply fundamentals, domestic prices of Methanol traced an upward trajectory from INR 26000 to INR 27000 per MT Ex-Depot Mumbai. 


Insights on Methanol Price Movement

Uncertainty reigns over the Indian Methanol market with several traders making it available around INR 25 per kg in the last week of July.  Prices are still struggling to come to their pre-pandemic levels amidst uncertainties coinciding with staggering crude futures in July due to demand slowdown. Most importers seemed gritting their teeth to reduce stocks from ports to make space for arriving cargoes. One of the importers stated that tanks are almost full as offtakes are minimal from downstream Formaldehyde manufacturing factories.


Insights on Methanol Price Movement

Prices for Bulk Methanol dived to INR 24 per kg resisting further gains on 20th July. The downfall was observed in response to easing market conditions as local traders reported a significant spike in production efficiency of the global players and smooth inflow of Iranian cargoes. As mentioned by an industry expect, a major Methanol exporter has increased its operating efficiency almost to 95 per cent after 2 months. A local trader described the market to be stable in terms of demand and supply, however raised his concerns over lockdowns implemented recently in some Indian states till 31st July.


Insights on Methanol Price Movement

With easing trades and recovering demand, several traders took a sigh of relief with the arrival of several Methanol cargoes which remained stuck in the west coast for almost 2 months since the lockdown was imposed on the nation. Tracking the import-export data, Iranian Methanol exports to India have recorded a significant fall since last year. Iran has traditionally been the largest seller of methanol to India. A cargo from SABIC Asia Pacific Pte Ltd. with a volume of about 1400 MT reported was shipped at the Vizag port was heard sold at higher rates due to soaring freight charges. Methanol Ex-Depot Mumbai prices were assessed around INR 26000 per MT throughout the third week of July.


Insights on Methanol Price Movement

Methanol prices in India have been strongly governed by the movements in the naphtha and crude oil market and demand-supply fundamentals. Slammed by the shrinkage in demand, the prices bottomed down to INR 24000 per MT. Mirroring the worries, Methanol Daily Bulk Ex-Depot Mumbai prices plunged after showing signs of recovery in the beginning of July while crude oil futures plummeted to USD 42.35 per barrel on Thursday. 


Insights on Methanol Price Movement

Methanol demand from the formaldehyde sector is gradually picking up, despite softness in the global market due to product surplus and lack of storage. Bulk Methanol prices in India are likely to remain pressured with better capacity utilization rates by the Middle Eastern players. However, short term gains could be seen as players sense demand recovery from several downstream sectors. Methanol Daily Bulk prices were assessed at INR 24500 per MT on Friday.