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  March 18th, 2021 | Written by

Rising Demand for Alternative Fuels to Spur the Global Methanol Market

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  • Today, China is the world's largest importer of methanol, comprising 28% of total shipments.
  • The global methanol market is estimated at approx. 82M tonnes, equating near $32B (IndexBox estimates).

IndexBox has just published a new report: ‘World – Methanol (Methyl Alcohol) – Market Analysis, Forecast, Size, Trends, and Insights.’ Here is a summary of the report’s key findings.

In January 2021, the U.S. reentered in the Paris Agreement aimed at reducing global greenhouse gas emissions. New environmental agenda in the U.S. and European countries can boost the global energy market’s transformation in the medium term. Attention is currently paid to the potential for world industry and transport to switch to environmentally friendly fuels.

The global methanol market is estimated at approx. 82M tonnes, equating near $32B (IndexBox estimates). The use of methanol as an alternative fuel is in line with the new global green agenda and can become a new driver of the methanol market. As compared to traditional fuels, methanol has some advantages: it doesn’t emit nitrogen and sulfur oxides when being combusted, and there are many raw materials, including renewable ones, which could be used for the methanol manufacturing process.

In November 2020, the Maritime Safety Committee of the International Maritime Organization (IMO) adopted interim guidelines on methanol as a marine fuel. Afterward, in January 2021, the American Bureau of Shipping published guidelines on methanol as a marine fuel. One of the global leaders in maritime transportation, the Maersk Line, has announced a strategy to convert its vessels to run on environmentally friendly fuels. Maersk regards methanol for this purpose as a suitable option.

The authorities of China, the country with the largest motor vehicle fleet globally, are seriously considering the possibility of setting up cars to run on methanol fuel. Since 2012, they conducted a pilot program, during which over 1K methanol-powered vehicles had been tested, several methanol filling stations had been built, and some new standards for methanol had been developed.

Today, China is the world’s largest importer of methanol, comprising 28% of total shipments. Over the past 7 years, its imports have grown by an average of 7 percent per year, reaching 8 million tonnes (IndexBox estimates). The announced plans to use methanol as fuel could accelerate already impressive growth.

This trend is expected to be relevant also for other major importers. Global methanol imports are estimated at near 28M tonnes, which equated to $9.1B. India (2.3M tonnes) occupied the second position in the ranking of top methanol importers, followed by South Korea (1.8M tonnes), Japan (1.7M tonnes), Germany (1.4M tonnes), and Taiwan (Chinese) (1.3M tonnes). All these countries together held a 30% share of total imports. The following importers – Brazil (1,192K tonnes), Indonesia (902K tonnes), Thailand (764K tonnes), the Netherlands (720K tonnes), Malaysia (686K tonnes), Poland (654K tonnes), and Singapore (608K tonnes) – together made up 20% of total imports.

Source: IndexBox AI Platform