European methanol gets on contango structure
The market framework for NWE methanol slipped into contango Wednesday as August prices continued to be secure during the holiday, as well as lower supply degrees expected in September stimulated an uptick popular for later freights, sources said.
"We have a mild contango framework, which is rational offered the supply dynamics going into September. Individuals have actually had high supply degrees entering into Q3, August is still quite stable, yet the levels are running out," an investor source stated.
Northwest European methanol spot costs were analyzed at Eur280.50/ mt FOB Rotterdam Wednesday.
Cargoes for distribution in August were evaluated at Eur279/mt, as well as for distribution in September at Eur283.50/ mt Wednesday, leading to a 21 cent daily contango framework throughout the Platts 5-30 day window.
An offer was reported Wednesday at Eur282/mt which attracted no buying rate of interest. At the same time, two trades were reported for September shipment, the initial at Eur282.50/ mt, and afterwards at Eur283.50/ mt later on in the day.
A manufacturer source associated thinner trading task in August to the holiday period and stated the contract-spot spread has been closer to normal lately, encouraging clients to call higher contract volumes which would ultimately absorb the Rotterdam quantities in August, triggering higher rates after that.
"Essentially the spread is much more normal currently so it encourages people to call agreement quantities rather than pushing out to the following month," he stated.
Current prices puts the place market at a 13% discount rate to the Q3 ECP of Eur322/mt.
The contract-spot price cut struck a five-year high of 34% in June when contract costs went to Eur412/mt as well as a wave of imported product pressed place prices down to Eur271.50/ mt.
Looking ahead, https://www.irowater.com expect higher costs in September on a combination of scarcer feedstock natural gas throughout the summer season period and also supply concerns between East and Asia decreasing the quantity of methanol available in the European area.
"We have a mild contango framework, which is rational offered the supply dynamics going into September. Individuals have actually had high supply degrees entering into Q3, August is still quite stable, yet the levels are running out," an investor source stated.
Northwest European methanol spot costs were analyzed at Eur280.50/ mt FOB Rotterdam Wednesday.
Cargoes for distribution in August were evaluated at Eur279/mt, as well as for distribution in September at Eur283.50/ mt Wednesday, leading to a 21 cent daily contango framework throughout the Platts 5-30 day window.
An offer was reported Wednesday at Eur282/mt which attracted no buying rate of interest. At the same time, two trades were reported for September shipment, the initial at Eur282.50/ mt, and afterwards at Eur283.50/ mt later on in the day.
A manufacturer source associated thinner trading task in August to the holiday period and stated the contract-spot spread has been closer to normal lately, encouraging clients to call higher contract volumes which would ultimately absorb the Rotterdam quantities in August, triggering higher rates after that.
"Essentially the spread is much more normal currently so it encourages people to call agreement quantities rather than pushing out to the following month," he stated.
Current prices puts the place market at a 13% discount rate to the Q3 ECP of Eur322/mt.
The contract-spot price cut struck a five-year high of 34% in June when contract costs went to Eur412/mt as well as a wave of imported product pressed place prices down to Eur271.50/ mt.
Looking ahead, https://www.irowater.com expect higher costs in September on a combination of scarcer feedstock natural gas throughout the summer season period and also supply concerns between East and Asia decreasing the quantity of methanol available in the European area.
