Methanol futures on the Zhengzhou Commodity Exchange ended 16 October at ¥3,354 a tonne. That is 53.15 per cent higher than at the start of the year and 49.73 per cent above a year ago.

The headline gain hides a violent fortnight. After China's National Day holiday, spot methanol briefly touched its highest level in nearly six years. It then fell hard as chemical plants that turn it into plastics shut down rather than pay the price.

Producers elsewhere, from Louisiana to Trinidad, have felt the swings too.

What the benchmark measures

The Zhengzhou contract is China's methanol benchmark, with delivery warehouses in eastern and central China.

China makes most of its methanol from coal in Inner Mongolia and Shanxi. Coastal buyers rely more on imports, mainly from the Middle East. According to Xinhua Finance, imports cover about 12–15 per cent of Chinese demand. Methanol-to-olefins (MTO) plants, which make plastics feedstock, consume about half.

How the Iran war tightened supply

Iran is the key supplier. Methanex chief executive Rich Sumner said in March that Iran ships about 9–10m tonnes a year, almost all to China. He said 18–20m tonnes of Middle East exports were constrained by the effective closure of Hormuz.

Physical damage followed. that several plants at Asaluyeh, home to three-quarters of Iran's capacity, shut after strikes on 6 April. By late August, Everbright Futures counted seven Iranian plants offline, equal to 64 per cent of capacity.

Chinese ports emptied. August imports fell 54 per cent year on year, according to Chuangyuan Futures. Coastal stocks dropped to a record low of 305,100 tonnes on 8 October.

A spike, then a sell-off

Prices peaked straight after the holiday. The main November contract rose nearly 17 per cent in two trading days to a high of ¥3,959. Spot prices at Taicang, the main port, reached about ¥4,880.

The rally broke on demand. MTO plants were losing a record ¥1,800–2,000 for every tonne they processed. Tianjin Bohua and Lianhong Gerun shut units around 10 October, and others planned cuts.

Futures fell 7.41 per cent on 12 October alone. Coastal spot prices fell more than ¥900 a tonne from the peak by 15 October, according to Longzhong data. Huatai Futures said port stocks then rose to 367,200 tonnes.

From record high to sharp sell-off

Methanol hit a record ¥4,484 a tonne on 9 October, according to Trading Economics data. The reversal that followed was one of the sharpest of the year. Over the week the benchmark lost 22.81 per cent.

The exchange's main November contract showed a similar pattern. It fell about 20 per cent from its 9 October high of ¥3,959 to ¥3,166 on 15 October. The speed of the fall shows how far prices had run ahead of what Chinese buyers could afford.

Costs and the outlook

Coal costs have not driven the rally. Chuangyuan put full costs for coal-based methanol in Inner Mongolia at ¥2,638 a tonne in early October, leaving a profit of ¥1,288.

The market faces a tug of war. Analysts cited by Sina see support near ¥3,200–3,300 in the next few weeks, with October imports only about half a normal month. For November, they flag weaker MTO demand, more non-Iranian cargoes and new Chinese capacity.

Global trade and the producers who gained

China is the centre of world trade. It imported about 14.4m tonnes in 2025, CCFGroup reported, with 59 per cent of Iranian origin.

Producers outside the Gulf have profited. Methanex, the largest supplier, posted record adjusted earnings of US$577m in the second quarter. Its average realised price rose to US$529 a tonne, from US$374 a year earlier. Its US plant at Geismar, Louisiana, produced a record 1.03m tonnes.

The windfall is uneven. Methanex began idling its Titan plant in Trinidad in July and expected lower third-quarter earnings.

Metric

Value

Price (CNY/T)

3354.00

Daily change

0.00 (0.00%)

Weekly change

−22.81%

Monthly change

−3.51%

Year to date

+53.15%

Year on year

+49.73%

Price date

16 October 2026