Methanol Rebounds to 4 Week Highs on Chinese Supply Tightness

Asian Supply Crunch

In China, methanol futures have rallied significantly, recovering from recent lows. The driver is a combination of unplanned plant outages and logistical delays that have tightened regional availability. Buyers are aggressively bidding for spot cargoes to ensure they can meet production schedules for downstream chemicals like olefins.

US Market Stability

In contrast to the volatility in Asia, the US methanol market is trading calmly. Production along the Gulf Coast is steady, and feedstock costs (natural gas) have recently dipped, supporting producer margins. The price differential between the two regions is widening, which could eventually trigger increased exports from the US to Asia.

Derivative Demand

Demand from the construction sector (via formaldehyde) is seasonally slow, but the energy sector's demand for methanol blending remains consistent. The 'Methanol-to-Olefins' (MTO) plants in China are the key swing factor; as long as their margins remain positive, they will continue to support global methanol consumption.