Methanol Rebounds from Lows as Chinese Coal Prices Firm Up

Feedstock Cost Pressure

Methanol production in China is heavily dependent on coal. The recent firming of coal prices at major ports like Qinhuangdao has increased the production cost floor for methanol, forcing producers to raise their offers to maintain margins. This cost-push effect has been the primary driver for the recent rebound in ZCE methanol futures.

Downstream Demand Trends

Demand from the 'Methanol-to-Olefins' (MTO) sector has remained steady, though margins for plastics producers are under pressure. Some firms in the region are signaling voluntary capacity reductions of up to 25% to combat oversupply, which could affect methanol consumption patterns in the first quarter of 2026.