Increase in usage of methanol for the production of petrochemicals, such as formaldehyde, acetic acid, dimethyl ether (DME), olefins, dimethyl terephthalate (DMT), biodiesel, and solvent, and its usage as an alternative fuel in automobiles to maintain environment clean and green are boosting the demand for this chemical. Due to the aforementioned factors, the global methanol market is projected to witness significant growth during the forecast period (2021–2030).
The outbreak of COVID-19 has led to the plummet of the methanol industry. Due to the government decisions, such as lockdown, in order to curtail the spread of COVID-19 virus has significantly impacted almost all sectors, including automobile, construction, and chemical. Since methanol is widely used in these industries, the demand for this chemical has also dropped. Further, due to border closures in 2020, supply and distribution also impacted in a negative way, which further decreased the demand for methanol.
On the basis of industry, the methanol market is categorized into automotive, construction, chemical, electronic, paint & coating, pharmaceutical, packaging, and others. Among these, the automotive industry holds significant market share. This is due to the increasing demand for vehicles across the world and mounting interest for alternative source of clean fuel for automobiles. Also, there is high usage of formaldehyde resin (a methanol derivative) in the manufacturing of interior-molded components of vehicles to reduce weight and increase fuel efficiency.
Based on feedstock, natural gas is the fastest-growing category in the methanol market. This is attributed to the ease and environment-friendly production process of methanol from natural gas, relative to other feedstocks. Moreover, the production process is thermodynamically and kinetically occurred at low temperature and pressure, which would contribute to the growth of the market in the category.
The Asia-Pacific (APAC) region is the fastest-growing methanol market, across the world. This is owing to the increasing demand for methanol derivatives, due to the growing construction and chemical industries. Further, the usage of methanol as a biofuel increases its demand in the automobile industry, as the industry is looking for environment-friendly alternative for diesel and gasoline.
Key players operating in the global methanol market are Celanese Corporation, BASF SE, Methanex Corporation, SABIC, Petroliam Nasional Berhad (PETRONAS), Mitsubishi Gas Chemical Company Inc., OQ SAOC, OCI N.V., LyondellBasell Acetyls LLC, and QAFAC.
These players are expanding their facilities to increase the production of methanol. For instance, in March 2021, Fairway Methanol LLC, a joint venture, which was established through a 50–50 investment between Mitsui & Co. Ltd. and Celanese Corporation, decided to expand its facilities in order to increase methanol production from carbon dioxide (CO2) and also to maximize the effective capacity of the existing plant.