US methanol curve in contango amid supply concerns

US methanol curve in contango amid supply concerns

Houston (Platts)--19Jul2005

The US methanol pricing curve was in contango through September as market
participants ponder outages in the Americas that will take some 11,845 mt/day
of supply out of the market during the third quarter. 

The forecast loss in supplies is due to both current and upcoming unit
outages. While July spot pricing has held at 77-78 cts/gal, a broker on
Tuesday said August buy/sell ideas were 77-80 cts/gal. But a producer claimed
Aug buyers were asking for up 80 cts/gal. A buyer on Monday said an Aug-Sep
offer existed at 82 cts/gal.

Tighter supplies in the Americas is a result of Methanex's 5,000 mt/d Atlas
methanol facility in Trinidad shutting down last weekend. That's expected to
last for 21 days. Repsol YPF's 1,095 mt/d methanol plant at Neuquen,
Argentina, is going down for maintenance into August. At the same time,
outages of 2-3 weeks are pending in Q3 for Methanex's Chile II and III units,
which total 5,750 mt/d. Sources are also on the lookout if new supply hits the
market in Q3 from Methanol Holdings' 5,400 mt/d M5000 plant in Trinidad.
That's expected up by the end of this month.

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