TPH Energy Research said Monday that Methanex (MX.TO, MEOH) raised its China and Asia Pacific methanol contracts for January 2025. And following at least five months of rollovers, it saw this as a "positive".

According to TPH, Methanex increased the China contract price to $400 per tonne from $380 per tonne while lifting the Asia Pacific price to $410 per tonne from $400 per tonne.

TPH said the price increase aligns with the small improvement in spot methanol prices in China so far this month and likely reflect a tight global methanol market due to a number of outages and production restrictions in areas like Iran, the U.S. and Europe.

TPH added its global methanol contract average is "clocking in" at $619 per tonne to start the first quarter of 2025, up from $551 per tonne in the fourth quarter and $522 per tonne in the third.

TPH had previously been modeling in lower prices in Q1 in anticipation of at least some of the outages easing. In recent quarters, it noted, MEOH has been capturing a little less than 70% of this global average, and based on a 8.3mmt annual run rate, MEOH's published sensitivity shows that every +$50/tonne in realized methanol prices is worth another +$88mm per quarter of EBITDA. or +$350mm per year.

Overall, stronger methanol prices are "quite positive" for Buy-rated Methanex, TPH added.