Fluctuation in Methanol Prices as the Demand Varied in Asia Throughout December 2023

Methanol prices were unstable in Asia throughout December 2023. The instability in the cost of methanol was observed due to the varying demand from the downstream industries during the period, especially in India and China. However, amid the fluctuation, prices of methanol depicted an uptrend, maintaining a positive market sentiment throughout the period.

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An analysis by Procurement Resource reported a m-o-m hike of approximately 1.47% in China for the period between November and December 2023. On the other hand, a m-o-m decline of approximately 4% is observed in India, during the period.

November Ended with a Rebound in Methanol Prices While the Production Units Raised the Factory Quotations in China

Methanol costs were impacted by several complex factors during November 2023. Coal prices, a vital feedstock used for methanol production, maintained a stable graph during the period, causing consolidation in methanol production. However, the month ended with a fine rebound as different production units based in China increased their factory quotations, depicting a positive impact on the market’s sentiments.

Low Methanol Supply Influenced Called for Disruption in Supply Chain During December

Methanol productions were affected in December, causing low supply amid a mixed-paced demand from downstream industries. Restrictions were imposed on natural gas export activities, which is also a raw material used for methanol, resulting in disruption in methanol production, as well. Moreover, ongoing maintenance activities in methanol production units dropped the supply even more.

Mixed-Paced Demand Acquisition for Methanol Resulted in Oscillating Prices

Demand from the downstream industries for methanol was not stable throughout November and December. Downstream industries such as acetic acid, formaldehyde, dimethyl ether, and more use methanol in their production. The production of acetic acid remained stable, while formaldehyde production declined amid rising environmental concerns in major Asian regions.

Additionally, production for dimethyl ether increased, having a positive influence on the methanol market. The overall market experienced low methanol supply, with uncertainty in the coal prices and unstable demand for methanol during December 2023.

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According to Procurement Resource, methanol prices vacillated throughout December as a result of varying demand and unstable feedstock prices. However, the market witnessed a slight uptick in the m-o-m prices of methanol of approximately 1.47% in China, exhibiting a fine pace in the demand-supply chain during the period.