Global methanol supply will surge in the second half of the year

Recently, market participants said that despite the continued strong demand from China's methanol-to-olefin plants, the global methanol market will continue to be under pressure from increasing production capacity into the second half of 2021, and that the production capacity of the United States and Iran will continue to increase
.

At the same time, the balance of supply and demand in the European market entering the third quarter will shift from tight to balanced

The Asian market is mixed

The Asian market is mixed

The fundamentals of the Asian methanol market in the second half of the year were mixed
.

Because of export growth, China's downstream demand is expected to remain strong, but the rebound in the epidemic in parts of Asia may curb export demand

Platts data shows that since March, CFR Far East polypropylene prices have been steadily falling, while CFR China methanol prices have remained relatively stable
.

In addition, Iran’s Sabalan Petrochemical Company put into production a 1.

In the Indian methanol market, the country’s new coronary pneumonia infection cases have surged, leading to a large number of local plant shutdowns in many regions, and the outlook for downstream demand is still shrouded in uncertainty
.

It is expected that the demand disruption will spread to the third quarter, and the demand recovery still depends on the situation of epidemic control

European demand remains firm

European demand remains firm

In the first half of this year, the supply of methanol in the European methanol market continued to be insufficient.
In the second quarter, some installations were planned to be overhauled, coupled with the supply interruption in Trinidad and Venezuela, causing prices in the European market to rise
.

However, despite market expectations of tight supply, the market still maintained a balance of supply and demand by the middle of the second quarter

　　The recovery of production capacity in Europe and the increase in imports have weighed on prices.
It is expected that the oversupply in the third quarter will put further pressure on spot prices unless there is a supply delay
.

Although supply issues dominate market sentiment, demand remains strong, and market participants expect this situation to continue into the third quarter

　　U.
S.
methanol production capacity soars

　　U.
S.
methanol production capacity soars

　　Market participants predict that there will be oversupply in the US methanol market in the second half of the year
.

The market has different expectations on how to digest the new capacity

　　At the same time, market sources revealed that domestic methanol supply in the United States will depend on the reliability of methanol facilities in eastern Texas and Trinidad
.

In the first half of this year, the market reported several production and operation problems

　　Affected by the economic activity of the new crown pneumonia vaccination in the United States, domestic methanol demand in the United States is also expected to rise in the second half of the year
.
The production of most intermediate products (such as acetic acid and vinyl acetate monomer) in the Gulf of Mexico in the United States has fully resumed operation after extensive facility damage caused by freezing damage in February, which will increase the demand for raw methanol
.
It is expected that construction activities will also increase the demand for formaldehyde derivatives in the market
.
However, the demand for methyl tert-butyl ether (MTBE) for gasoline blending is still unknown
.
It also depends on the economic recovery in Mexico and Latin America after the epidemic
.