US methanol spot at 2011 high, pressure builds over Aug contract

25 July 2011 19:23  [Source: ICIS news]

HOUSTON (ICIS)--The US methanol spot barge price rose to a 2011 high on Monday, raising speculation over the direction of the August contract to be announced this week.

As spot prices hit 120 cents/gal (€0.22/litres) on Monday, buyers said that an increase was a possibility for the monthly contract, which has rolled over for six straight months at 126-128 cents/gal.

The spot range has jumped 10% in July, mostly on news of planned and unplanned outages at Methanex’s Atlas plant in Trinidad.

One buyer said the unplanned outage reported last week at the Atlas plant coupled with a move up in China methanol prices this month provided strong support for a hike in the August contract.

“Nothing’s going to happen in August and September,” the buyer said, “and then the prep for winter will begin.”

Methanol is a major ingredient in antifreeze and windshield wiper fluid, which see big sales increases in the winter.

Another buyer predicted a contract rollover, because crude prices have not climbed up above $100/bbl in July.

Crude prices have increased 7% this month. Methanol prices tend to track oil in the long term.

($1 = €0.70)

For more on methanol, visit ICIS chemical intelligence

By: Lane Kelley
+1 713 525 2653

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