Viewpoint: US methanol supply length to stabilize

The US methanol market will enter 2020 with mostly steady supply length.

For much of the second half of 2019, lingering maintenance or operational problems at methanol plants along the Gulf coast lifted US prices over their global counterparts.

The largest plant in the US, Natgasoline's 1.650m t/y plant in Beaumont, Texas, experienced significant downtime from August through November. Two other plants in the region were also offline for several weeks during that time.

Producers were the most active in the spot market during that time, but with seasonal demand slowly declining and production returning to normal operating rates, spot activity in the US is likely to dip heading into 2020.

Barring any unexpected outages, US production will not see any significant additions until late 2020 or early 2021.

YCI Methanol One, a 1.7m t/y plant in St James, Louisiana, is expected to be commissioned in late 2020. Koch Methanol signed on as an investor in the plant in August.

US Methanol's Liberty One 200,000 t/y plant in West Virginia is also expected to commission in late 2020.

Further out, construction has started at Methanex' 1.65m t/y Geismar 3 unit in Louisiana, but completion is not expected until 2022.

The war of attrition continues in the Pacific Northwest, as environmental groups take Northwest Innovation Works (NWIW) to court and Washington state regulators further evaluate the company's planned $1.8bn methanol plant at the Port of Kalama.

These efforts have stalled the $2bn plant from being built, despite other regulatory hurdles clearing this year. More back-and-forth between environmental groups, regulators and NWIW is expected to continue through 2020.

By Steven McGinn