Methanol: Expected supply increase, inventory inflection point approaching_Industrial Additives

After entering June, the supply pressure of methanol in the mainland increased, and the price center of gravity accelerated downward. At the end of May, a northwest CTO unit was undergoing maintenance, and the quantity of methanol exported was relatively large. At the same time, the production load of the methanol unit supporting another MTO unit in the region has reached about 90%, and the quantity of external purchases has dropped. Some methanol plants in the northwest have accumulated inventory, and the pressure of inventory transfer has increased. , some supply sources were diverted to Shandong and East China. At the beginning of the month, there were signs of accumulated inventory in northwest and east China. Yankuang Yulin and Shandong Phoenix both have maintenance plans in the middle of the month, but they only partially alleviate the supply pressure. The CNOOC South China unit restarted in the middle and late this month, and Guangxi Huayi plans to put into production. In addition to the CTO unit, the overall methanol maintenance volume from June to July Not much, and domestic supply is expected to gradually expand.

The Iranian supply problem that attracted much attention in May has now been effectively alleviated. ZPC, Marjan, and Kimiya have resumed operations, and Bushehr and Kaveh are also planning to restart in the near future. Concerns about Iranian supply have temporarily come to an end.

The recent correction in methanol prices has played a positive role in downstream demand. The MTO plant in East China has gradually come out of the loss-making state. However, in view of the weak olefin prices, MTO profits still remain on the edge of profit and loss, and the affordability of methanol is still limited. The profits of other traditional downstream formaldehyde and dimethyl ether have also improved to some extent. After the Dragon Boat Festival, formaldehyde consumption is expected to gradually enter the off-season, and the demand for methanol may decline to some extent.

Generally speaking, the supply pressure of methanol may gradually increase, and it is expected to enter the seasonal accumulation stage. The valuation of methanol needs to be focused on in the future. After this market regulation, coal prices have experienced a sharp correction. However, coal supply has not been effectively released for the time being. The supply of goods in the mainland and ports is tight, and coal prices have rebounded again. The current domestic methanol production cost is significantly higher than the same period last year, and the price decline in high-cost areas is significantly lower than that in other areas. The marginal production capacity of domestic methanol will be tested again in the future. Methanol prices may be relatively resilient in the short term, and attention should be paid to the dynamic changes in upstream raw materials and methanol units.