Introduction: Following the holiday, domestic methanol prices surged significantly due to downstream restocking and positive macro sentiment. However, this rapid price increase quickly compressed margins for multiple downstream sectors, prompting several large-scale plants to signal potential shutdowns. As negative feedback from the downstream sector began to impact the market, sentiment cooled rapidly, leading to a sharp correction from extremely high price levels.
1. Supply Side
Regarding domestic supply, production reached its year-to-date peak after the holiday but subsequently declined as some units entered scheduled maintenance. Despite this dip, output remains at elevated levels. Future recovery is expected, with domestic supply likely returning to highs; monitoring of domestic plant operations is advised. Furthermore, during the price correction phase, traders adopted a cautious approach, resulting in suboptimal shipments by producers. Although domestic supply decreased within this cycle, its supportive effect on the inland market was limited.
| Figure 1: Weekly Domestic Methanol Production Trend Comparison (2025-2026) (10,000 tons) | Figure 2: Weekly Domestic Methanol Import Volume Trend Comparison (2025-2026) (10,000 tons) | |
|---|---|---|
| Data Source: Chempricehub Information | Data Source: Chempricehub Information |
Regarding import supply, volumes remained at low year-to-date levels. However, weak buying interest from downstream users—driven by losses and expectations of plant shutdowns—led to thin trading activity and a rapid price decline. Looking ahead, import volumes are expected to remain low, providing support to the coastal methanol market. Nevertheless, short-term price trends will depend heavily on demand-side developments and macroeconomic factors.
2. Inventory
The recent rapid price drop has hindered both producer shipments and buyer withdrawals, leading to an accumulation of inventory at production facilities. However, current stock levels remain relatively low, limiting their impact on prices. Future attention should focus on shipment performance and how inventory positions may influence pricing.
| Figure 3: Weekly Domestic Methanol Sample Producer Inventory Trend Comparison (2025-2026) (10,000 tons) | Figure 4: Weekly Domestic Methanol Port Inventory Trend Comparison (2025-2026) (10,000 tons) | |
|---|---|---|
| Data Source: Chempricehub Information | Data Source: Chempricehub Information |
Port methanol inventories increased this week, though the rise was modest, with regional variations observed. In East China, tradable volumes remained persistently low, supporting the coastal market. In South China, tradable volumes increased significantly compared to previous periods, coinciding with sustained price declines. The extent of these declines will depend on downstream negative feedback and changes in tradable volumes.
3. Summary
Overall, following the rapid surge in methanol prices, downstream follow-through was weak. Combined with low import volumes and insufficient raw material stocks at some downstream facilities, negative feedback from the downstream sector gradually emerged. This triggered a swift price correction, although regional markets displayed varying degrees of divergence. Looking forward, the domestic methanol market is expected to retain downside potential. The magnitude of any further decline will depend on changes in downstream plant operations and fluctuations in tradable methanol volumes.
Comments
0