Reviving downstream fuel industry can surge the price of Methanol in USA
- Journalist: Nicholas Seifield
In United States, the price of Methanol surged to $615/ton EXW Louisiana with the inclination of 0.5% compared with the previous week where prices were observed to $612/ton EXW Louisiana. In the upcoming weeks, the prices of Methanol in USA may burst with the increment of 5%-7% and will likely to hover around $620/ton-$625/ton.
Feedstock Natural Gas prices in USA had surged by nearly 12% when observed on 12 January bringing the prices to record high in this month. February future contract on the New York Mercantile Exchange (NYMEX) reached nearly $4.75 per MMBtu where price rally up to be strongest since gas future debuted more than 30 years ago. Downstream Methanol fuel applications had started to grow and according to EIA biodiesel Production is expected to grow by 22pc till the end of 2022. Methanol consumption in automobile industry is also spotted to be on the higher side. US Methanol two largest marketers Methanex and Southern Chemical sales revenue increase with increase in the demand of Methanol as a fuel industry. Shares of Methanex Corporation have rallied 28.2% in the last six months with the reason being the continuous rise in the prices of Natural Gas and Methanol.
According to ChemAnalyst, with the increase in the demand of Natural Gas and coal the prices will also increase. It is expected that the consumption of Methanol in the downstream fuel industry will grow significantly in the US market. In 2022, the fuel efficiency will likely to increase 1%-2% each year. In December, the US Natural Gas inventories ended at 3.2 trillion cubic feet, 3% more than 2016-2020 average. According to the market players it is expected that the inventories which will end March 2022 at 1.8 Tcf which would be 8% more than 2017-2021 average for March.