Methanex raises September methanol APCP

31 August 2007 05:24  [Source: ICIS news]

SINGAPORE (ICIS news)--Methanex announced on Friday a $15/tonne month-on-month increase in its September methanol Asian posted contract price (APCP) to $300/tonne CFR (cost and freight).

The increase was in line with increasing spot prices in the US and Asia amid tightened supply during August, regional distributors and buyers said. 

An increase in the APCP was expected due to a combination of factors, including Methanex's Chile plants having a continued production outage, low inventories in Asia and higher spot prices in China, a Korean buyer said.

In China, spot prices have surged 15% in the last month to $290-300/tonne amid tight supply and healthy demand.

The expectation that APCP will go up even further than the announced $300/tonne had kept some Chinese sellers on the sidelines, putting additional upward pressure on the country’s domestic methanol values, a trader said.

'It is surprising why the contract price has risen this little when the spot prices have been going up much quicker especially in the US', said another regional buyer. But prices might increase further in October, he added.

The APCP is the benchmark for methanol contracts in South Korea and Japan, where large importers buy on negotiated formulas based on the APCP.

By: Anu Agarwal
+65 6780 4359

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