Methanol

# Methanol Commodity Market Dynamics Intelligence and Analysis

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## I. Panoramic Scan of Price Trends

| Time Node | Core Signal | Price Range/Change |
|---|---|---|
| Oct 25-29 | Mild pullback (bearish consolidation) | 60-day cycle: Tier 3 (mid-level); 3-month/1-year cycle: Tier 4 (mid-high level) |
| Oct 26 | Strong consolidation (bullish consolidation) | Import gap + cost support, but capacity restarts suppress upside |
| Nov 4 | Single-day plunge of 7.32% | Main contract fell to 3,153 CNY/ton; port inventory surged by 58,900 tons |
| Nov 5 | Clear bearish signal | Triple moving average divergence turned negative; 60-day cycle dropped to Tier 2 (mid-low level) |
| Nov 6 | Regional divergent rebound | National average price up 1.5% MoM; Fujian/Gansu/Henan up >2.5%; Shanxi alone down 3.5% |
| Nov 9-10 | Weak consolidation (bearish oscillation) | 60-day cycle fell to Tier 1 (low level); intense bull-bear battle |

**Core Judgment: Over the past month, the methanol market has undergone a four-stage evolution: 'high-level oscillation → sharp decline → divergent rebound → weak consolidation,' with the overall price center clearly shifting downward.**

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## II. Supply and Demand Fundamentals Intelligence

1. **Supply Side: Coexistence of Incremental Release and Import Disturbances**
- **Domestic production at high levels**: Production in the first week of November was 1.9984 million tons, with a capacity utilization rate of 88.86%, a slight MoM decrease of 0.46 percentage points. Strong expectations for the restart of inland coal-based facilities indicate continuous accumulation of supply pressure.
- **Volatile import dynamics**: October arrivals were at historic lows, providing support, but early November arrivals surged 58.37% MoM (157,100 tons). Port inventory spiked from 353,800 tons to 412,700 tons (+16.65%), shifting from destocking to restocking, a clear bearish signal.
- **Tight overseas supply with incremental expectations**: Nominal new overseas capacity in 2026 is only 1.65 million tons (2.2% growth), with actual capacity growth at ~0.8%. However, the share of imports from Iran and Russia is rising, with full-year import growth estimated at 6%-7%. Import pressure will significantly increase in the second half of the year.

2. **Demand Side: MTO Unit 'Collapse' as the Biggest Drag**
- **Widespread MTO shutdowns**: Coastal MTO unit operating rates have dropped to extremely low levels, with all external procurement units shut down, causing a cliff-like decline in demand. In 2025, external procurement MTO units suffered average annual losses exceeding 1,000 CNY/ton, with the loss trap unresolved.
- **Slight support from traditional downstream**: Traditional downstream sectors such as formaldehyde, acetic acid, and MTBE maintain rigid demand, but the volume is insufficient to offset the MTO reduction.
- **Expectations for demand recovery**: Profit repair for MTO may prompt coastal units to restart, leading to a slight demand recovery, but the timing and magnitude remain uncertain.

3. **Inventory Side: A Tale of Two Extremes**

| Inventory Type | Data (as of Nov 4) | Trend |
|---|---|---|
| Producer Inventory | 310,800 tons | MoM -4.37%, narrow destocking |
| Port Inventory | 412,700 tons | MoM +16.65%, shifted to restocking |

**The stark contrast between low inland inventory and port restocking has intensified regional contradictions.**

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## III. Cost and Macro Disturbances

- **Clear coal price support**: Coking coal and anthracite prices remain firm, raising the cost center for coal-based methanol. Against the backdrop of 'anti-involution' and dual carbon control, expectations for coal price stabilization are reinforced, firmly capping downside space at the cost line.
- **Undercurrents of geopolitical tension**: Democrats gained control of the US Congress in the midterm elections, while US-Iran negotiations have made limited progress. The Iranian Supreme Leader maintained an adversarial stance toward the US, with no substantive improvement in Middle East tensions, increasing volatility in energy and chemical products.

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## IV. Analytical Judgment

**The current methanol market is in a stalemate of 'bearish dominance, bullish support,' with three major contradictions intertwined:**

1. **Fundamental contradiction of supply increase and demand decrease** — Domestic facility restarts + increased import arrivals vs. widespread MTO shutdowns; the supply-strong, demand-weak pattern is unlikely to change in the short term.
2. **Game between low costs and weak reality** — Coal price support builds a bottom, but weak demand suppresses rebound height, keeping prices 'squeezed' in a narrow range.
3. **Intensified regional divergence** — Shanxi faces the greatest supply pressure (price 3,365 CNY/ton, MoM -3.5%), while coastal regions like Fujian/Guangdong maintain strength due to tight supply (3,870/3,850 CNY/ton), revealing logistics and regional arbitrage opportunities.

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## V. Future Outlook

| Dimension | Judgment |
|---|---|
| **Short-term (1-2 weeks)** | Weak consolidation dominates, with the main contract oscillating in the 3,100-3,300 CNY/ton range. Port restocking pressure persists; the pace of MTO restarts is the key variable. Without substantive restart signals, prices may still test lower levels. |
| **Medium-term (1-3 months)** | If import arrivals continue to surge in December, coupled with limited seasonal winter demand recovery, prices may remain weak. However, the 60-day cycle has reached the low-level range (Tier 1), capping significant downside due to cost and low inventory. A bottom is expected to form in the 3,000-3,400 CNY/ton range. |
| **Risk Warnings** | ① Concentrated MTO restarts could trigger a phased rebound; ② Sudden changes in US-Iran relations may disrupt the energy cost chain; ③ Large-scale inland facility maintenance could alter supply expectations. |

**Operational Recommendations: Hold short positions cautiously; consider staged long positions on dips. Traders should flexibly operate based on regional price spreads (e.g., allocating low-priced Shanxi supplies to East China) and strictly control inventory risks.**