Global Methanol Demand Likely To Surpass 95MMT By 2021: IHS Markit

Global methanol demand is likely to surpass 95 million metric tons (MMT) by 2021, according to IHS Markit World Analysis—Methanol 2017, with China boasting 54 percent of world capacity and 46 percent of global production.

UK based financial services company IHS Markit informed, in a statement, in 2010, global methanol demand reached 49 MMT.

In 2000, China represented just 12 per cent of global methanol demand, while North America and Western Europe represented 33 per cent and 22 per cent, respectively.

By 2021, IHS Markit said Northeast Asia (dominated by China), will account for nearly 70 per cent of global methanol demand, followed by North America at 9 per cent and Western Europe at 8 per cent.

Methanol is a basic chemical used to produce fuels and other traditional chemicals.

“China has quickly become the dominant force in the global methanol market, and continues to be the focal point with its coal-based production setting the global market price,” said Mike Nash, global director of syngas chemicals at IHS Markit, and one of the authors of the IHS Markit World Analysis—Methanol 2017.

“The impact of Chinese demand growth for methanol cannot be overstated, since we at IHS Markit forecast that Chinese demand growth is expected to increase very rapidly at around 7 per cent per year, such that, by 2021, without additional Chinese capacity, net imports will double in volume from their 2016 level,” Nash said.

"Supply and demand pressures have always driven methanol pricing, but now that methanol has significant volumes of derivatives that compete as alternatives to crude-oil derived products, the picture becomes significantly more complicated, since affordability of some methanol derivatives  becomes heavily dependent on crude oil-price fluctuations," Nash added.