UpdateMethanex announces €390/t for its MEPCP

03 October 2007 20:45  [Source: ICIS news]

(Adds update in paragraph 1)

HOUSTON (ICIS news)--Canadian methanol producer Methanex announced on Wednesday a European posted contract price (MEPCP) of €390/tonne, valid 1 October to 31 December, the company said.

Having refused another offer below €400/tonne on Tuesday, one Methanex customer said “it’s too high and we don’t accept €390/tonne”.

“It is damaging to the downstream production of derivatives,” he added.

Another large consumer was still vying for €340/tonne as a possible contender for the European contract price.

Fourth-quarter discussions were ongoing following reports from both the buyer and seller sides that a level of €370/tonne could also be a contender as a European contract price.

“I heard two players had settled at €370/tonne,” another customer said, commenting on market talk on Tuesday.

Methanex’s figure was €40/tonne below Helm’s earlier proposal for the European fourth-quarter contract of €430/tonne and its controversial monthly figure of €405/tonne for October. Helm was not available for comment.

This came after Helm’s re-evaluation of supply and demand which prompted it to pull its original suggestion of €340/tonne.

The third-quarter figure was €218/tonne FOB (free on board) Rotterdam, but a global shortage of methanol resulted in talks of significant price hikes for the fourth quarter.

There were indications from Methanex at the end of September that Argentina would soon resume exports of feedstock natural gas to the company’s 3.8m tonne/year methanol complex in southern Chile.

Argentine natural gas accounts for 60% of Methanex’s consumption in Chile, feeding the production of 2.3m tonnes of methanol annually.

European methanol producers include Statoil, BASF, Helm and BMCN.

(Additional reporting by Al Greenwood)

By: Caroline Howard
+44 20 8652 3214

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