17 July 2012 03:53 [Source: ICIS news]
By Heng Hui
An estimated 200,000 tonnes of methanol from Iran are due to arrive in China next month, as suppliers located more vessel owners willing to call on Iranian ports now compared with May, when tighter international sanctions were imposed against the Middle Eastern country, market sources said.
In the week ended 13 July, spot methanol prices were assessed at $363-370/tonne (€294-300/tonne) CFR (cost and freight)
But more spot cargoes became available to
Some buyers deem it just right for prices to be a bit soft given continued weakness in downstream demand.
Suppliers of Iranian methanol are currently riding on the renewed enthusiasm of vessel owners to move commodities from the Middle East to
Iranian suppliers are footing the shipping cost just to clear stocks, as buyers refuse to pay higher prices, an industry source said.
With the financial sanctions in place against
“We did a fixed price in contrast to our normal formulas, as we would seize the opportunity to load at any vessel willing to call on Iranian ports and then think about selling the material,” a seller with Iranian material said.
Increasing volumes of methanol are also flowing into
Some Iranian material is heard to be being carried by Indian, Chinese and Indonesian vessels, they said, but this could not be confirmed.
Only a handful of Chinese players in the methanol market were able to conclude business directly with
A bonded warehouse cargo of Iranian origin was heard sold at $355/tonne EXWH (ex-warehouse), which was equivalent to below $350/tonne CFR on an import parity basis. The seller acknowledged he had no higher bids for this cargo and that he had to clear stocks.
The pricing outlook for methanol is bleak for the next two weeks as fundamental demand remains poor, according to market observers.
Most of the end-users in
Domestic Chinese methanol cargoes were transacted at yuan (CNY) 2,700-2,910/tonne ex-tank, reflecting lower deals concluded throughout last week. This was an import parity of $344-370/tonne CFR China, about $10/tonne lower than the spot import prices.
“Buyers who wanted to purchase, particularly on a spot import basis, were doing it for money credits,” said a China-based distributor.
India methanol prices stabilised but were still assessed in a broad range at $325-345/tonne CFR India on 13 July, because of wide ranging selling ideas for Iranian and non-Iranian material.
Players in the south Asian market have mixed expectations on how prices will behave in the coming weeks, with some expecting further price weakness, while others see a bottoming out of prices.
Demand in the downstream formaldehyde sector is in doldrums amid the monsoon season, according to an
India is also due to receive more Iranian spot cargoes, on top of the contractual supply it gets, before the month draws to a close, thereby aggravating the pressure on prices, industry sources said.
In southeast Asia, demand remains weak because of the upcoming Ramadan – the Muslim fasting month that will start on 20 July – when some downstream plants will be shut for maintenance and as shorter working hours is due to be implemented.
Two Taiwanese buyers said they had no demand to purchase until September, in view of depressed derivative markets.
($1 = CNY6.38 / ($1 = €0.81)
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