Galaxy Futures: Methanol port inventory reduction accelerates; expected downside potential is limited

During the holiday period, Trump continued to express a desire for a ceasefire and held negotiations with Iran. Although uncertainty over the outcome still remains, the market gradually shifted direction. Some methanol plants in the Iran region restarted again, and daily output increased from 1,200 tons to around 8,000 tons. The Strait of Hormuz remains congested, but some vessels have already passed through successfully. Domestic trading switched to a ceasefire mode. Concerns in the domestic market about the impact of a sharp reduction in future import volumes have gradually faded. In addition, the largest MTO facility at the ports resumed operation, with monthly consumption reaching 240k tons. Inventory in the East China and South China regions continues to be reduced rapidly. As of April 1, 2026, the total port inventory stands at 1.03 million tons, down by 120k tons from the previous period. In March, inventory drawdown exceeded 300k tons; 80k tons were loaded for shipment in March. It is expected that imports in April will fall to around 600k tons. The current port inventory drawdown exceeds 300k tons. The problem of a shortage of methanol supply at domestic ports is still present. If the U.S.-Iran talks go smoothly and the war ends in the short term, domestic import volumes will gradually recover, port cargo sources will be replenished, and the price spread between domestic and international markets will gradually narrow. Methanol is expected to return to domestic fundamentals over time. However, as the 05 contract moves into the delivery-approaching month, ports are accelerating inventory drawdown, and the U.S.-Iran conflict is still ongoing; therefore, upside/downside room is also expected to be limited. Focus on developments in the U.S.-Iran situation. (Galaxy Futures)