November contract prices for the largest two distributors of methanol in the US, Methanex and Southern Chemical Corp. (SCC), are expected to be announced in the next week, sources said Wednesday, and both are expected to raise their prices.
SCC's October contract price was $1.33/gal, with Methanex at $1.32/gal.
Spot prices rose 29.25 cents between August 6, when they were assessed at $1.07/gal FOB USG, and October 18, when they were assessed at $1.365/gal FOB USG. The October 18 assessment was the highest mark in four years.
Spot prices have fallen since reaching that October 18 peak, with Tuesday's assessment at $1.295 cents/gal FOB USG.
While the spot price is expected to continue to decline, many in the market expect November contract prices will see a month-on-month increase.
On September 27, when both Methanex and SCC announced their contract prices for October, the Platts spot assessment was $1.1350/gal FOB USG.
"I think the contract price announcements could be up as much as 20 cents," one distributor said, noting that spot prices are now about 15 cents higher than they were at the time of the October contract announcement.
"I think the contract price increase will be in the low double-digits," said a trading source.
Other sources suggested November contract price increases of 8-10 cents.
