Introduction: The unloading speed of methanol import vessels along the coast was severely affected by typhoons. As of Wednesday this week, methanol port inventories continued to decline to 401,500 tons, hitting a historic low, while floating storage increased. Due to the typhoon impact, the draft in the river channels was slightly constrained, which may still affect the entry speed of some large vessels.
According to the latest data, the expected discharge volume from July’s methanol import vessels is approximately 1.04 million tons, with some cargoes delayed to August. However, the August arrivals remain uncertain for now. After the renewed outbreak of the US-Iran conflict, both the Iranian and US fronts may again disrupt shipments within the Persian Gulf, reigniting supply concerns in certain overseas regions. CFR India surged sharply this week, with some firm negotiations rising to $500–510/mt, climbing about $168 from the low point before the conflict reignited. As a result, inquiries for exports and re-exports from Chinese ports have re-emerged. Export shipping plans that were thought to be near completion have been revived, prompting us to adjust the monthly export outlook accordingly. This will also become a key factor influencing the future pace of inventory accumulation.
The opening of the export arbitrage window is undoubtedly a positive signal. Combined with the current low paper basis and the uncertainty of future imports, it will support some market participants’ willingness to hold positions, potentially affecting the liquidity of some cargoes. However, it is confirmed that monthly exports will not return to the peak levels seen between March and May earlier this year, given that overall inventory—including bonded and marketable cargo—still sits at a relatively low base.
Regarding the outlook, the movement of Iranian vessel shipments after the US blockade at 4:00 am on the 15th and the impact of Iran’s strait closure on Saudi cargo flows are the core issues affecting August import supply. Although coastal olefin plants have seen concentrated shutdowns and a limited volume of purchases from foreign vessels, whether further procurement and stockpiling will occur is key to determining the port inventory trend in August. The night session on Friday saw another strong rally; the contango structure will prompt USD-based merchants to primarily hedge against the 09 contract. Meanwhile, capital from outside the industry, due to uncertainty over long-term macro factors, appears more inclined to focus on near-term contracts for certainty. In summary, the inter-month spreads on the futures curve may still face considerable uncertainty. Close attention should be paid to all the factors mentioned above.
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