27 April 2011 19:16 [Source: ICIS news]
HOUSTON (ICIS)--The US methanol May contract rolled over as Methanex released its nomination on Wednesday, marking the fourth month in a row for the monthly range at 126-128 cents/gal.
Methanex’s 128 cents/gal nomination followed Southern Chemical’s 126 cents/gal announcement on Tuesday. The two companies historically have set the monthly North American contract methanol range with their nominations.
Buyers generally said they thought the contract should be reduced, based on spot prices that have drifted lower by 1 cent/gal fir each week during the past month and are about 23 cents/gal lower than the contract range.
Spot prices this week have dipped to 103.50-105.00 cents/gal.
One buyer said falling spot prices and a recent move by Celanese declaring force majeure (FM) on downstream vinyl acetate monomer (VAM) made a good case for lowering the May methanol contract range.
“It seems that there will be abundant availability in the US Gulf with reduced demand from acetic acid and windshield fluids applications,” the buyer said.
Sellers supported maintaining the contract range by citing rising crude prices, which have jumped 8% in the past month.
NYMEX front-month crude futures traded around $112.60/bbl at mid-day on Wednesday, compared with a close of $104.27/bbl on 30 March.
Methanol prices tend to track crude values over the long term.
($1 = €0.68)
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