Methanol Prices Surge in the Short Term

Methanol Prices Surge in the Short Term

Since mid-March, my country's methanol market has experienced significant price fluctuations, with prices rising rapidly in the short term. This surge was primarily driven by two factors: firstly, the Middle East conflict forced the closure of the Strait of Hormuz; secondly, my country's cancellation of methanol export tax rebates on April 1st led to a rush of purchases by exporting companies before prices rose, resulting in heightened market sentiment. The combined effect of these two factors directly propelled a sharp price increase in late March.

The chaotic situation in the Middle East disrupted the stable supply chain.

The Middle East is a core global methanol production region. Iran, a major global methanol exporter, has faced severe restrictions on its methanol exports due to the conflict. The closure of the Strait of Hormuz directly disrupted the global methanol supply chain. Against this backdrop, international methanol prices rose first, subsequently impacting the domestic market and driving up spot prices.

The cancellation of methanol export tax rebates fueled strong market buying sentiment.

Effective April 1, 2026, my country officially abolished the export VAT rebate for methanol. This policy adjustment directly led to increased costs and reduced profit margins for export companies. The inevitable consequence of rising methanol prices was that export companies rushed to ship goods during this policy window, resulting in short-term domestic demand exceeding supply. The concentrated release of multiple positive factors directly triggered a surge in the methanol market in late March, with both spot and futures prices rising sharply in tandem. In some regions, supply was tight, and prices were even raised three times a day.

This recent sharp rise in methanol prices is the result of the combined effects of geopolitical conflicts, policy adjustments, and market sentiment. The market is expected to maintain high prices in the short term. Given the current situation of a sharp short-term price increase and high market uncertainty,

customers with immediate needs and low inventory levels may consider locking in short-term supplies to avoid disruptions to normal production caused by future supply shortages and continuously rising prices.