HOUSTON (ICIS)--September contract postings will likely roll over for US methanol, a quick survey of buyers and traders revealed on Monday.
Methanex and Southern Chemical Corp (SCC) usually issue their contract postings in the last week of the month but have yet to release them.
The two companies have historically set the monthly contract range with their prices. In June, July and August, Methanex issued contract prices of 160 cents/gal and SCC of 162 cents/gal.
Rollover expectations stem from the gap between the August contract, at an average of 161 cents/gal, and Monday’s spot range, which dipped somewhat to 137.00-139.00 cents/gal.
The dip in spot followed a wave of buying late last week done “under the radar”, as an industry observer put it.
Sources on Friday put the spot range at 137.00-138.50 cents/gal, though some were unaware of trades being done in the 136-137 cents/gal range.
“It’s all moving under the radar into the big buyers’ tanks,” a seller said.
Methanex and SCC also buy methanol, though both are producers or represent producers. SCC is the North American marketing arm for Methanol Holdings (Trinidad) Limited (MHTL), which has five methanol plants in Trinidad.
Methanex operates two plants in Trinidad and is moving one idled plant in Chile to the US, with plans to move another.
Traders expected buying at the end of the month because of natural gas cutbacks in Trinidad coming in September.
Trinidad is the major source of US methanol imports. Natural gas cutbacks for all petrochemical producers in Trinidad are expected to begin on about 2 September, industry sources have said.
The gap between spot and contract prices now is 23 cents/gal, which is a little higher than the one-year average of about 19 cents/gal.
($1 = €0.75)