The operating pressure of the methanol industry is still relatively high

　　In 2021, the large-scale and intensive trend of China's methanol industry will be significant, and the dominant position of coal-to-methanol will remain stable
.
However, due to the sharp rise in raw material prices, the profitability of methanol companies is difficult to improve
.
Judging from this year, the industry is facing a more severe and complex domestic and foreign environment, and the overall operating pressure is still relatively large
.
This is the information released at the 2022 China Methanol Industry Conference held in Jinan, Shandong on July 20
.

　　The trend of large-scale intensification is obvious

　　According to Gu Zongqin, chairman of the China Nitrogen Fertilizer Industry Association, in 2021, four sets of methanol plants with a capacity of one million tons or more will be put into operation
.
Among them, there are 3 sets of 1.
8 million tons/year installations and 1 set of 1 million tons/year installations
.
This made last year not only the year with the largest number of new capacity additions in the past four years, but also significantly increased the scale and concentration of the industry
.

　　According to statistics, in 2021, China's methanol production capacity of 1 million tons/year and above will reach 44.
3 million tons/year, an increase of 16.
9% over the previous year; An increase of 7.
7%; methanol production capacity below 600,000 tons/year is 34.
55 million tons/year, down 5% from the previous year
.

　　While the scale of methanol plants is increasing, it also shows a trend of intensive development
.
The total methanol production capacity of 10 large enterprises including National Energy Group, Sinopec Group, and Shaanxi Yanchang Petroleum Group will reach 52.
06 million tons/year in 2021, accounting for 53.
4% ​​of the national total; the output will be 48.
99 million tons, accounting for 63.
1% of the national total.

.

　　The main position of coal-to-methanol is stable

　　Gu Zongqin pointed out that, driven by the new coal gasification technology, the large-scale, efficient and clean level of coal-to-methanol has been significantly improved, and it has become an important pillar of the methanol industry
.
According to statistics, the coal-to-methanol plant using new advanced coal gasification technology has a production capacity of 68.
21 million tons per year, accounting for 70% of the total production capacity
.

　　At the same time, the methanol capacity and output of the combined alcohol unit further declined
.
In 2021, the methanol production capacity of the combined alcohol unit will be 5.
36 million tons/year, accounting for 5.
5% of the total production capacity, down 11.
8% from the previous year; the output will only be 2.
234 million tons, less than 2% of the total output
.
The production capacity of coke oven gas to methanol has increased with the commissioning of several new projects, but due to the influence of the upstream coking industry and environmental protection policies, the output has decreased to 6.
04 million tons, down 5% from the previous year
.
Natural gas-to-methanol production capacity also decreased
.

　　Market picks up but earnings are hard to improve

　　In 2021, the methanol market as a whole will show a trend of rising and falling
.
From the perspective of the whole year, the average price of methanol is 2,500 yuan (ton price, the same below), which has rebounded compared with 2019 and 2020, up 18.
1% and 41.
6% respectively
.
However, the price increase of coal, the main raw material, is much higher than this, making it difficult to improve the profitability of methanol companies
.
Taking bituminous coal as an example, the average arrival price will rise to 1,150 yuan in 2021, up 53.
3% and 63.
8% from 2019 and 2020 prices, respectively
.
Overall, the profitability of coal-to-methanol companies in 2021 is only slightly better than in 2020
.

　　Gu Zongqin pointed out that in the first quarter of 2022, the methanol market supply and demand improved and prices rose, but the market fluctuated again in the second quarter
.
The profits of gas head and coke oven gas-to-methanol companies are relatively good, but due to their small proportion, it is still difficult to change the overall operating pressure of the industry
.

　　The volume of imported methanol has declined

　　From the perspective of methanol imports, imports in the first half of 2021 are basically the same as the previous year, and they will drop significantly in the second half of the year
.
In the whole year, China's methanol import volume was 11.
198 million tons, down 13.
9% from the previous year
.

　　According to Gu Zongqin's analysis, there are three main reasons for the reduction of China's imported methanol
.
First, the overall load of international methanol plants is low and the supply is tight
.
This is mainly related to gas restrictions and rising natural gas prices
.
Second, the international methanol downstream industry has recovered and demand has increased
.
However, China's import prices have been in a global depression, and some sources of goods flow to other high-priced areas
.
Third, the domestic methanol-to-olefins plant has a relatively low load due to factors such as limited electricity and low profits, and the demand for methanol is relatively weak
.

　　"Since this year, methanol imports have rebounded from the second quarter, and it is expected that the whole year will be the same as or slightly higher than last year
.
" Gu Zongqin said
.

　　Development faces severe and complex environment

　　Gu Zongqin said that the development of methanol industry is facing severe and complicated environment this year
.
From the perspective of the international environment, the conflict between Russia and Ukraine has brought greater uncertainty to the international energy market
.
From the perspective of the industrial chain, the impact of oil and natural gas on the methanol industry mainly comes from the supply side of raw materials
.
There is a competitive relationship of substitution between petroleum route chemicals, oil products and domestic coal via methanol to chemicals and methanol fuels
.
In the future, the international oil supply and demand game will still exist, and the impact on the methanol industry is inevitable
.
In terms of natural gas, the continuous advancement of global energy cleanup will increase the demand for natural gas, which in turn will affect the price of international gas head methanol products and their competitiveness in the Chinese market, and will also affect the balance of supply and demand in the domestic market
.

　　From the perspective of the domestic environment, the production capacity below the benchmark level of the coal-to-methanol industry should be basically cleared in 2025
.
The benchmark level and benchmark level of energy efficiency in key areas of high energy-consuming industries (2021 edition) for coal-to-methanol is much higher than the current national standard
.
Taking the production of methanol using bituminous coal as raw material as an example, 26.
5% of the existing production capacity have not reached the benchmark level, and only 12% have reached the benchmark level
.
The task of reducing energy consumption alone will be a huge challenge for the methanol industry
.

　　In addition, the methanol industry is also facing high cost pressure
.
Under the guidance of the "dual carbon" goal, the number of newly approved coal mine projects across the country has been greatly reduced in recent years, while there is still potential for power demand growth, and coal prices are likely to run at a high level in the later period
.
Therefore, the production pressure of coal-to-methanol enterprises is still relatively high
.