Methanol Intelligence Report

Methanol trades at $315.50/mt CFR China (SGX Aug-26), up from a $300 late-June low but still 25% below the March peak above $400. The Hormuz closure enters Day 165 with Iran-Oman management talks stalled on Iranian demands for US concessions. Argus estimates 4.5Mt of Middle East production lost through early July, with exports through the Strait down from more than 1Mt/month to under 200kt/month. Yet the price has not broken higher: China MTO runs at 40-50% of capacity versus a normal 70-80%, demand destruction reached 2.7Mt, and coastal inventories have only ~0.5Mt left to draw. The market is disruption-tight in the near term and structurally oversupplied in the medium term, with Argus flagging a potential Q4 physical supply squeeze. The procurement call: defensive, hold, hedge tail risk, and watch the Iran-Oman talks and MTO margins as the two break triggers.