Quarterly Update on Global Methyl Formate Market
For the Quarter Ending June 2021
During the second quarter of 2021, Methyl Formate supplies eased in the North American region along with the surged production and better availability of the key feedstock Methanol. The restoration of the industrial infrastructure in the US Gulf coast restructured the dented supply chains in the regional market. Demand was persistent from the downstream manufacturers of Formic Acid derivatives, whereas offtakes were bolstered from the refrigerant sector with the arrival of peak summer season in North American. Taking cues from the feedstock Methanol pricing and high demand prospects, settlements for Methyl Formate maintained stability during Q2 2021.
In the Asia pacific region, supplies of the Methyl Formate surged during the second quarter of 2021, owing to the seasonal push from the demand side by the downstream refrigerant industries. Despite hovering uncertainties in the regional market, buyers in India were seen actively procuring bulk volumes to keep the inventories level balanced. Due to the rising inflation rates in the raw materials and high cost of key feedstock Methanol provided sufficient support to the prices of Methyl Formate in the Chinese market. FOB Shanghai Methyl Formate prices were settled at USD 1970 per tonne towards the end of the April month, whereas the pricing trend in India remained firm throughout the second quarter of 2021.
Overall, the Methyl Formate outlook in the European region improved comparatively from the previous quarter as the production activities in the NWE region recovered with better climatic conditions. Better cargo volumes from the US further supported the regional supplies. Performance of the downstream refrigerant industries remained robust. As a ripple effect of the high demand and high cost of feedstock Methanol, the prices of the Methyl Formate in the European market maintained firmness throughout the second quarter.
For the Quarter Ending March 2021
Methyl Formate supplies in the region were severely hampered during Q1 2021, as the industrial infrastructure around the US Gulf Coast collapsed amid severe freeze weather conditions and supply chain disruptions, followed by production related constraints due to the lack of unavailability of the key feedstock chemicals. Exports to the other regions declined amid domestic shortages. Demand surged in the quarter, due to better offtakes from the pharmaceutical sector. Hiked prices of upstream products correspondingly surged the prices of Methyl Formate, which forced domestic players to be more flexible towards cheaper imports.
The supplies in the Asia Pacific region were balanced to tight during the first quarter of 2021, due to the constant offtakes from the downstream sector as the industrial and commercial activities improved in the region. However, some constraints were witnessed amid the shortfall in supplies from the US. Price segment fluctuated as it followed significant downtrend in the first half and hiked in the second half due to market tightness during the first quarter. Surge in Crude futures proportionally impacted the prices of Methyl Formate in the Indian market to USD 1144/ton levels in Q1.
Tight Methanol remained a key factor driving Methyl Formate prices during Q1. Methyl Formate supplies in the European region were balanced to tight during Q1 2021, as key producers in the region went for a turnaround, due to reduced feedstock supplies from the overseas. Formic acid supplies also remained deterred for a larger part of Q1. The demand was balanced as the consumption from the downstream sectors improved and arbitrage from the Asian region improved towards the end of the quarter.
For the Quarter Ending December 2020
The price of Methyl Formate surged in the H1 of Q4, due to the strong values of upstream crude oil followed by the ramped up downstream activities in the Asian markets after a drastic fallout due to the COVID pandemic in the first half of the year. The later half of the quarter was affected by logistic disruptions and lack of manpower resulting in production cutbacks. A major Indian producer reported increased product enquiries from Vietnam. Post November, prices of Methyl Formate in India followed an uptrend on the back of strong values of upstream crude and restricted imports, maintaining an average around USD 1078/ton throughout the quarter.
The supplies of Methyl Formate in Europe were hit by a couple of factors. Upstream supplies were affected as Equinor, a key methanol producer in Norway reported a fire broke out. Imports stood majorly impacted due to constraints in availability of shipping containers and soaring freight rates. Supply crunch considerably effected the prices of Methyl Formate throughout the region, triggering a double-digit spike in December. The demand remained affected amidst fears of another lockdown imposed in various European countries and shortage in the supplies of feedstock from the Middle east.
In the US, Methyl Formate supplies were impacted due to the aftermath of hurricane season in the US gulf. Major facilities were kept under maintenance led by shortage in the feedstock availability during the first half of Q4. During the second half, supplies improved as several plants started the production in lieu of demand uptick from the downstream pharmaceutical applications. The demand of Methyl Formate surged as major economies eased lockdown restrictions and exports, especially to the Asian region.