[Hot Focus]: This article takes you to understand the current situation of China's methanol market

Lead: Recently, the methanol market has been weak and difficult to change against the background of weak macroeconomics, poor cost support, and unchanging contradictions between supply and demand. Quotes in the Chinese market have dropped again and again. The main contract 2309 contract hit a low of 1953 yuan during the year. Chemical products are important raw materials, and their application range is very wide and affects many industries.

Introduction to basic process

At present, the main production processes of methanol include coal-to-methanol, coke oven gas to-methanol, and natural gas to-methanol. The main process routes adopted are also different for different regions. Affected by China's energy characteristics of "more coal, less gas and lack of oil", coal-to-methanol accounts for the dominant position in the market in China, accounting for about 71% of the market share. Most coal-to-methanol is concentrated in the northwest region, and most of the southwest region uses natural gas to produce methanol. In North China, methanol is mainly produced from coke oven gas, while in foreign countries, methanol is mainly produced from natural gas. Therefore, most of the methanol imported by China is also produced from natural gas.

Supply side analysis

In recent years, with the continuous expansion of downstream and the continuous release of downstream demand, China's methanol production capacity has also been on an increasing trend. According to incomplete statistics, China's planned production capacity will exceed 100 million tons in 2023, and new units will still be put into operation in the later period.

With the gradual release of production capacity, methanol output has also gradually increased. As of May 2023, China's methanol output is approximately 29.8664 million tons, an increase of 401,500 tons last year, a year-on-year increase of 1.36%. With the smooth commissioning of new production capacity, the overall supply in the field has increased significantly. Although the traditional spring inspection is carried out as scheduled, the overall maintenance intensity is smaller than last year. Especially in April, with the return of early maintenance equipment, As well as the commissioning and stable operation of new units, the market supply has always been sufficient, and port inventories have remained high, resulting in the overall market supply having always maintained a high level, and the overall market supply has not been significantly reduced.

Demand side analysis

As a basic organic chemical raw material and high-quality fuel, methanol has relatively wide uses. Its downstream is mainly concentrated in new downstream fields led by MTO. In recent years, with the breakthrough and innovation of MTO domestic technology, its industry has developed rapidly and has become the biggest driving force for the growth of methanol consumption in recent years. As of 2022, MTO consumption accounts for approximately 54.84% of total methanol consumption. However, due to the continued poor profitability of China's main downstream olefin industry in the past two years, This has led to a slowdown in new olefin plant projects in China. Other downstream products are formaldehyde, dimethyl ether, acetic acid, methyl tertiary butyl ether ( A series of organic chemical products such as MTBE), dimethylformamide (DMF), methylamine, chloromethane, and dimethyl terephthalate; at the same time, methanol is also an excellent energy and vehicle fuel. It can be added to gasoline to be blended or replaced by gasoline as a power fuel. In the past two years, with the continuous implementation of policies such as dual control of energy consumption, carbon neutrality, carbon emission, environmental protection, power rationing and the development of clean fuels, the future consumption of methanol fuel deserves attention.