US methanol trade flow shifts to exports

US methanol trade flows shifted in 2022, making the US into a predominantly methanol-exporting nation.

The US exported 3.3mn metric tonnes (t) of methanol in 2022 versus 1.5mn t of imports, according to the latest data from Global Trade Tracker. In 2021, the balance was 2.3mn t of exports against 2.3mn t of imports.

In 2017, the US imported 2.6mn t of methanol and exported 1.2mn t.

High natural gas production and low methanol costs caused this shift in the import and export balance.

In 2012-2013, inexpensive shale gas allowed idled US methanol capacity to restart. This led to idled methanol units from Chile to relocate and new methanol capacity being built.

As this production was realized, imports to the US — which was a large importer of methanol — slowly declined.

Traditional imports from South America, Africa and even the Middle East declined as new US production arrived. These traditional shipments to the US instead went to Europe, South America and the Asia-Pacific markets as alternatives.

And in 2023, the US could be poised to produce as much as 9mn t of methanol, against a demand of about 7mn t, according to an Argus analysis.

There is still incentive to import methanol into the US east coast, and, at times, the upper US west coast — meaning some 3mn t of US produced methanol has the opportunity to seek export markets.

Despite the natural gas price increase in the US over the last year, gas prices remain competitive with much of the production around the world.

Much of this production in the US was expected to find a home in Asia, most notably China, but economics and government policies all but closed this door to the large China market.

Fortunately for US methanol producers, the fallout of Europe banning Russia methanol beginning in 2022 opened to door for US product to move to Europe, rather than (most often) lower netbacks to Asia-Pacific markets.

Four of the top five recipients of US methanol exports in 2022 were European nations, according to trade data.

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