China’s secondary market for methanol gradually shrinking

In the first half of 2017, China’s methanol production was about 22.2 million tons, an increase of about 1.1 million tons, an increase of 5.1% over the same period last year; imports of about 3.9 million tons, compared with the same period last year decreased by about 350,000 tons, down 8%; apparent consumption 26 million tons, an increase of about 620,000 tons over the same period last year, an increase of 2.4%. China’s imports increased, imports were reduced, direct consumption and factory-to-factory trade increased, the secondary trade market gradually shrinking, which is the characteristics of the first half of the methanol market.

The first half of the slowdown in imports

In the first half of 2017, China’s imports of methanol compared with the same period last year reduced by about 350,000 tons, exports over the same period last year increased by about 90,000 tons. Since October last year, the domestic commodity market generally rose sharply, hit a three-year high, prompting China’s imports of methanol last year more than 8 million tons, only the first half of imports of 4.25 million tons. This year, the relatively high price of methanol to stimulate the domestic methanol enterprises to high-load production, part of the perennial unopened device restart, the first half of China’s total methanol production increased by about 5% over the same period last year.

Domestic high-yield to a certain extent, inhibited the international methanol exports to China, and the first half of China’s exports (re-export) about 100,000 tons of methanol, an increase of 5 times over the same period last year, relatively inhibited the international methanol high prices. For the port market, the import reduction, re-exports increased, and did not cause the situation without goods available, on the contrary, the domestic port area stocks continue to maintain a relatively high, domestic and imported goods in the port market and even two rounds of price games, and occupy Part of the port market.

Traditional downstream demand is shrinking

Table for the first half of the traditional demand for methanol downstream

From the data point of view, the first half of 2017, the overall downstream of methanol showing a shrinking state, especially environmental protection, safety supervision and other formaldehyde caused by the demand for methanol greatly reduced. In addition, due to crude oil prices fell, liquefied petroleum gas prices continued to decline, a corresponding reduction in demand for dimethyl ether, thereby reducing the amount of dimethyl ether on methanol. In terms of actual demand, the proportion of traditional downstream demand continued to decline in the first half, while the proportion of methanol to olefins has exceeded 50%.

Trade gradually changed

Production increased, apparent consumption growth, but the traditional downstream demand is declining, indicating that China’s secondary market for methanol continues to shrink. In 2016, China’s 39 million tons of production and 47 million tons of apparent consumption, of which about 21 million tons without direct trade into the downstream, accounting for about 44.68%, while the first half of this year, the proportion has risen to 46.15% about. Among them, the methanol to olefins plant own methanol accounted for the vast majority of the proportion, and part of formaldehyde, acetic acid, dimethyl ether, methane chloride and other factories also own methanol plant, strictly speaking, this part of the methanol is only intermediate, As a formal commodity appears in the market.

In addition to this part of the methanol plant directly to the downstream plant on the factory-like trade is also increasing, while the coastal Shenghong, Fu Tak, Xingxing and other olefins plant and occupy a large number of imported goods, so that traders left for the second trade Less of the goods. The first half of the nationwide carried out a long-term environmental protection, safety management, for the traditional scattered downstream of methanol caused no small impact, some small businesses were forced to shut down or even removed, the overall impact of the traditional needs of the downstream methanol. The Jiangsu Sheng Hong, Changzhou Fu Tak methanol to olefins plant to open, once again increased the methanol to olefins in the downstream of the proportion of methanol.

In the long run, China’s traditional methanol downstream of the operation through the perennial, the market has been basically close to saturation, there is no room for expansion, methanol-based olefin plant due to the larger amount of the majority of self-owned or about the way upstream. In recent years, with the environmental protection, safety supervision of the upgrade, part of the scattered methanol downstream is gradually being eliminated, this part of the demand will continue to reduce the trend for China’s secondary market for methanol, the extensive mode of operation is past, The future by the second trade links into the market of methanol, will gradually continue to reduce.