Rotterdam, Netherlands- When focusing on the European Methanol market, the German government decided to increase the amount of Natural Gas headed toward storage facilities while allowing more coal to be burned for electricity production, a tactic to lower gas consumption. With the week ending on 8th July, the global index for energy commodities calculated by the Hamburg Institute of International Economics fell an average of 2.7% compared with the previous month, affecting the prices of Petrochemicals in Europe. In Germany, the cost of Methanol slipped to USD 568/ton FD Hamburg with a week-on-week declination of 2.23%.

In the USA, surging fuel costs and a steep drop in Methanol price are squeezing US manufacturer's profitability. Average export buying prices of products throughout the northeast US also have registered steep drops with revised prices for the overseas suppliers.

The cost of downstream Acetic Acid and its derivatives in the global market slipped due to low purchasing appetite and a weak trading environment.

In the Netherlands, Methanex, a major supplier, and distributor of Methanol globally, had also reduced the prices of Methanol's contract prices for the European market.

In China, the price of Methanol slipped to USD 320/ton CFR Qingdao with a week-on-week declination of 1.53%. China methanol futures snapped the uptrend and has been extending the drop since early Jun. Domestic Methanol based on merchant feedstock coal is under continuous losses, and the supply exceeded the demand.

According to ChemAnalyst, the price of Methanol will decrease in the global market with fluctuation in feedstock Natural Gas prices. Methanol prices will remain under weak cost support and deterred futures. Ningxia Kunpeng's 330kt/yr new plant and Inner Mongolia Jiutai's 2 million mt/yr fresh plant are poised to start. They could materialize production in the upcoming months easing the prices of Methanol in the Asian market. In Europe, the prices of Methanol will be more likely to decrease, and the expected surging supply in the production units will fluctuate the market dynamics.