Investment Rating - The industry rating is "Outperform" (maintained) [6] Core Insights - The International Maritime Organization (IMO) has approved the "IMO Net Zero Framework" draft, aiming for net-zero emissions in international shipping by around 2050, which will create significant demand for green methanol [13][30] - Green methanol is emerging as a primary alternative fuel due to its low carbon emissions, with a CO2 reduction potential of up to 90% compared to traditional fuels [2][38] - The supply of green methanol is becoming economically viable, with China's production capacity expected to lead in scaling up supply [4][72] Policy - The IMO's net-zero framework will be enforced starting in 2027, applying to ocean-going vessels over 5,000 gross tons, which account for approximately 85% of international shipping CO2 emissions [13][30] - The framework includes mandatory fuel standards and a greenhouse gas (GHG) pricing mechanism, marking a significant regulatory shift in the shipping industry [19][30] Demand - The scale of alternative fuel vessels is rapidly increasing, with methanol ships becoming a mainstream choice. As of early 2025, 51.1% of new ship orders are expected to be capable of using alternative fuels [3][49] - Major shipping companies are actively investing in methanol-powered vessels, with Maersk leading the way in adopting methanol as a fuel source [55][58] Supply - Green methanol production is primarily through electrolysis and biomass processes, with current production costs for green methanol ranging from 4,600 to 5,500 yuan per ton for electrolysis and 3,400 to 5,300 yuan per ton for biomass [4][72] - As of August 2025, global green methanol production capacity is projected to reach 51.9 million tons, with China holding a 55% share of the global project reserve [4][72]

Core Insights - The demand for green methanol is expected to exceed 9 million tons by 2030, driven by existing orders for methanol-powered container ships and the promotion of green methanol applications in China [1][3][4] - The shipping industry's carbon reduction is urgent, with green methanol emerging as a key solution due to its low or zero carbon emissions [2][3] Industry Developments - The International Maritime Organization (IMO) is set to pass a net-zero emissions framework, requiring a 20% reduction in carbon emissions by 2030 compared to 2008 levels, which will promote the development of the green methanol industry [3] - The EU's inclusion of the shipping industry in its carbon trading system further encourages the transition to green fuels [3] Domestic Initiatives - China is actively promoting green methanol, with policies aimed at establishing a green fuel supply system by 2035 and accelerating port infrastructure for methanol refueling [4][6] - As of 2025, over 60 green methanol projects are underway in China, with a production capacity exceeding 8 million tons per year, positioning the country to potentially dominate global production by 2030 [6] Production Capacity and Technology - Green methanol production is in its early stages, with capacity expected to expand from 1.7 million tons in 2025 to 39.3 million tons by 2030, driven by numerous planned and under-construction projects [5][6] - The production cost of green methanol is currently 3 to 5 times that of traditional methanol, with future cost reductions dependent on technological advancements and process improvements [5]

Core Insights - The shipping industry's carbon emissions are under international scrutiny, with the IMO's net-zero emissions bill expected to pass in October, which will promote the development of green methanol [3][4] - Green methanol is identified as a key low-carbon or zero-carbon fuel, with its production relying on renewable resources, making it a viable green fuel option [2][4] Group 1: Regulatory Developments - The IMO's draft framework requires a 20% reduction in carbon emissions from the shipping industry by 2030 compared to 2008 levels, aiming for net-zero emissions around 2050 [3] - The EU has included the shipping industry in its carbon trading system, further pushing for a green transition in the sector [3] Group 2: Market Potential - There are currently 390 methanol-powered vessels in operation or on order, with expectations that demand for green methanol will exceed 9 million tons by 2030 [3] - Roland Berger predicts that green methanol demand could reach 12 million tons by 2030, considering future orders [3] Group 3: Domestic Initiatives - China is actively promoting the application of green methanol, with policies aimed at establishing a green fuel supply system by 2035 [4][7] - Over 60 green methanol projects are underway in China, with a production capacity exceeding 8 million tons per year, potentially accounting for 60% of global capacity by 2030 [7] Group 4: Production and Cost Dynamics - Current green methanol production is in its early stages, with a projected capacity of 3.93 million tons by 2030, driven by numerous planned and under-construction projects [6] - The price of green methanol is currently 3 to 5 times that of traditional methanol, with cost reduction being crucial for industry growth [6] Group 5: Investment Opportunities - Companies with green methanol production capacity or technological reserves include FJ Environmental, Goldwind Technology, and others [9] - Engineering and equipment firms such as Donghua Technology and China Chemical are also relevant to the green methanol sector [10]

Core Insights - The global shipping industry is undergoing a green transformation driven by IMO emission reduction targets and the European carbon tax, with green methanol expected to be a major alternative fuel by 2030, potentially increasing current methanol demand by 40% [1][3] Group 1: Drivers of Green Transition - The shipping fuel sector consumes approximately 300 million tons annually, contributing over 2% to global CO2 emissions, prompting a shift towards greener alternatives [1] - Three main drivers are identified: 1. IMO's carbon reduction targets aim for a 20%-30% reduction by 2030 and net-zero emissions by 2050 [1] 2. The inclusion of shipping in the European carbon trading system, with carbon taxes starting in 2024, leading to additional costs for shipping companies [1] 3. The current shipbuilding cycle, which lasts about 20 years, is entering a new phase after a previous boom from 2001 to 2008 [1] Group 2: Green Methanol as a Key Fuel - Methanol is favored for its advantages such as flexible storage and refueling, low cost per unit of energy, established infrastructure, low ship modification costs, and environmental benefits [2] - Currently, there are at least 320 orders for methanol-fueled ships, primarily container vessels, with a concentrated delivery period expected in 2026 [2] Group 3: Market Potential and Pricing - The global methanol consumption is projected to be around 140 million tons in 2024, with ship fuel demand translating to approximately 500-600 million tons of green methanol, indicating a potential growth of over 40% in global methanol demand if the penetration rate reaches 10% by 2030 [3] - The current price of green methanol exceeds 7,000 yuan per ton, making it economically unfeasible for shipowners, necessitating cost reductions through scale and technological advancements [4] Group 4: Investment Opportunities - Companies to watch include Jin Feng Technology, Longi Green Energy, Sunshine Power, Jidian Co., China Tianying, Fuke Environmental Protection, Taiyuan Heavy Industry, Aerospace Engineering, Donghua Technology, Tianwo Technology, Huaguang Huaneng, and Shenghui Technology [5]

1. Report Industry Investment Ratings - Methanol: Neutral [3] - Thermal Coal: Bullish [3] - Domestic Supply: Bullish [3] - Imports: Bearish [3] - Downstream Demand: Neutral [3] - Upstream Profits: Neutral [3] - MTO Profits: Bearish [3] - Inventory: Neutral [3] 2. Core Views of the Report - In the short term, the reality of methanol is weak, but the expectation is strong due to macro and demand increment expectations, leading to a continuous decline in the recent month spread. The short - term strategy is still a reverse arbitrage logic. For unilateral trading, more attention should be paid to the impact of commodity sentiment, and look for long opportunities at low levels in forward contracts [3]. - Coal prices have continued to rebound recently, with pit - mouth prices rising, and coal has entered the peak season [3]. - The domestic methanol operating rate has rebounded slightly but remains low, with many domestic plants under maintenance, resulting in a reduction in inland supply [3]. - Overseas plants are resuming production, and there is significant import pressure in August. However, the recent natural gas shortage in Iran has led to a reduction in supply, and the sustainability of this impact should be monitored [3]. - The operating rate of traditional downstream demand is firm, and the procurement sentiment inland is fair. For olefin plants, there are both restarts and maintenance. Xingxing is under maintenance while Mengda has restarted, resulting in a reduction in coastal demand [3]. - The profit of coal - to - methanol has remained stable, the profit of natural - gas - to - methanol has remained in the red, and the profit of coke - oven - gas - to - methanol has rebounded slightly [3]. - The MTO profit has rebounded significantly but remains weak [3]. - Ports have continued to accumulate inventory, while inland inventory has remained low [3]. 3. Summaries According to Relevant Catalogs Supply Domestic Supply - As of the week ending August 1, the national methanol plant operating rate was 71.5%, with the coal - to - methanol plant operating rate at 76.6%, the coke - oven - gas - to - methanol plant operating rate at 56.8%, and the natural - gas - to - methanol plant operating rate at 49.9% [11]. - During the period from July 25 to July 31, Yulin Kaiyue, Yankuang Yulin, Shenmu Chemical, Shanxi Linxin, and Shanxi Gengyang restarted, while Shaanxi Changqing and Runzhong Clean started maintenance. Many domestic plants, including Gansu Huating, Yulin Kaiyue, etc., are still under maintenance [13][14]. Overseas Supply - In Iran, multiple plants are operating at low loads, and two plants are shut down. The high - peak summer electricity demand in Iran has led to a natural gas shortage, which may affect methanol production. For example, Zagros PC's two sets of 330 - ton - per - year plants are operating at low loads, and Bushehr and Fanavaran PC are under maintenance [19]. - In other regions, Shell in Germany, Bioethanol in the Netherlands, and some plants in Malaysia, the US, Trinidad, Venezuela, New Zealand, and Chile also have various operating conditions such as shutdowns and low - load operations [19]. Demand Traditional Demand - The operating rate of traditional downstream demand has changed little. The operating rates of formaldehyde and dimethyl ether have rebounded slightly, while those of MTBE and acetic acid have declined. Currently, it is the off - season for traditional demand, but overall, it still shows resilience. The current profit of traditional downstream sectors is low, and it remains to be seen whether the peak demand season will materialize [51]. - The downstream procurement volume has declined recently. The procurement of olefins has slowed down after the previous restocking, and the procurement volume of traditional demand has declined continuously, mainly due to the recent price decline suppressing buying sentiment and the impact of the current traditional off - season [56]. Olefin Demand - As of July 31, the MTO operating rate was 81%, and the operating rate of externally - sourced methanol - to - olefin plants was 76.4%. Mengda's MTO plant restarted at the end of the month, and Xingxing's MTO plant shut down for maintenance [40]. - The profit of East China's MTO plants has recently recovered, mainly due to the recent decline in methanol prices in East China. However, the relatively strong inland methanol prices have led to a recent decline in inland profits [40]. Profits - Coal - to - methanol profit has remained stable, natural - gas - to - methanol profit has remained in the red, and coke - oven - gas - to - methanol profit has rebounded slightly. As of August 4, the profit of coal - to - methanol in Inner Mongolia was 136.5 yuan/ton, the profit of natural - gas - to - methanol in Southwest China was - 270 yuan/ton, and the profit of coke - oven - gas - to - methanol in Hebei was 275 yuan/ton [32]. - MTO profit has rebounded significantly but remains weak [3]. Inventory - This week, the port inventory is 91.5 tons, and the port's tradable inventory is 43.6 tons, continuing to accumulate. Ports are in the seasonal inventory accumulation period. With the shutdown of East China's MTO plants and the realization of increased imports, ports are expected to continue to accumulate inventory. Inland enterprise inventory has remained low and continued to decline last week. With more inland plants under maintenance and the large - scale procurement by an inland enterprise, the inland sentiment is expected to remain strong [74]. - The inventory of MTO sample enterprises has decreased slightly. The port procurement volume slowed down last week after the downstream's phased restocking. It is expected that procurement will increase slightly this week. The raw - material inventory of traditional downstream sectors has changed little [80]. Market Spreads - The basis of the East China main contract has remained weak recently. With ports continuing to accumulate inventory, the spot basis in East China has been continuously declining. It is expected that the basis will remain weak in July and August [89]. - The 9 - 1 month spread has been continuously declining. The weak reality has pressured the near - end price, but the macro situation and the improved expectation for methanol itself have made the far - end stronger. In the short term, the reverse arbitrage logic is expected to continue [89]. - The PP/L - 3MA spread has strengthened recently. After the methanol price reached a high and then declined, the spread first contracted and then expanded. In the short term, the volatility of the spread still depends on the methanol side, and short - term trading in bands is recommended [94]. Balance Sheet - The total methanol production, supply, and consumption show different trends throughout 2025. For example, the total production is expected to reach 742 tons in August 2025, with coal accounting for 614 tons, natural gas for 54 tons, and coke - oven gas for 74 tons. The total supply is expected to be 867 tons, and the consumption is expected to be 860 tons [98].

Group 1 - The successful refueling of 500 tons of domestic bonded green methanol fuel for the "COSCO Shipping Yangpu" vessel marks the first bonded green methanol refueling operation for international navigation in Northeast China, indicating the full connectivity of the Northeast Asia green methanol supply chain [1] - The "COSCO Shipping Yangpu" is the first domestically built methanol dual-fuel container ship, which will be operated by COSCO Shipping Container Lines Co., Ltd. on routes to the Americas [1] - The 500 tons of green methanol refueled at Dalian Port is sourced entirely from green methanol projects in Heilongjiang and Inner Mongolia, with the entire process receiving international sustainability and carbon certification, thus opening a "green" channel for international shipping fuel supply in Northeast China [1] Group 2 - To ensure the smooth implementation of the first bonded green methanol refueling operation, a pilot program was initiated to combine bonded warehouse and export supervision warehouse functions, allowing methanol to be transferred between accounts without actual transfer operations, significantly reducing operational costs for shipping companies and improving supply efficiency [2] - Northeast China currently has 75 green methanol and green ammonia production projects under construction or planning, accounting for over 80% of the national capacity. By 2030, the production capacity of green methanol and green ammonia in Northeast China is expected to exceed 31 million tons and 5.5 million tons, respectively, positioning the region as a major low-cost green shipping fuel production base globally [2]

Core Insights - The first batch of green methanol products from the integrated demonstration project of wind power coupled with biomass in Taonan City, Jilin Province, was successfully produced on the 15th [1] - The initial phase can achieve an annual production of 50,000 tons of green methanol, filling a technological gap in large-scale continuous production in China [1] - This project is part of the national first batch of green electricity hydrogen utilization demonstration projects and is the first project in the country to produce green methanol through hydrogen coupling with biomass gasification [1] Industry and Project Details - The green methanol integrated demonstration project is a key component of the "Hydrogen Movement in Jilin" and "Jilin Hydrogen Going to Sea" strategic layout, leveraging the abundant wind and biomass resources in western Jilin [1] - The project integrates self-developed core equipment from equipment manufacturing companies, aiming for sustainable production [1] - The products will be sold as marine fuel in international markets, and the technology used ensures zero fossil energy participation throughout the process, resulting in a nearly 70% reduction in carbon emissions over the entire lifecycle compared to traditional coal-based methanol [1] - The initial project phase is expected to reduce carbon dioxide emissions by approximately 65,000 tons annually [1]

1. Report Industry Investment Rating - Not provided in the content 2. Core View of the Report - After the geopolitical tensions eased, methanol returned to its fundamentals and is likely to remain weak in the short - term. It is recommended to wait and see for now [10][34] 3. Summary According to the Directory 3.1 Methanol Trend Review - Last week, affected by the easing of the conflict between Iran and Israel, methanol futures dropped significantly. By Friday afternoon's close, the weighted methanol futures closed at 2399 yuan/ton, a 4.99% decrease from the previous week. In the spot market, port methanol prices mostly rose, with prices in Jiangsu ranging from 2610 - 2820 yuan/ton and in Guangdong from 2440 - 2650 yuan/ton. The inland methanol market continued to rise, with the price in Ordos North Line in the main production area ranging from 1990 - 2033 yuan/ton and the receiving price in Dongying from 2265 - 2315 yuan/ton [12] 3.2 Methanol Fundamental Analysis - **Production**: Last week, China's methanol output increased to 2,057,636 tons, with a capacity utilization rate of 91.31%, a 3.00% increase. Some companies had new overhauls, but the overall recovery volume was greater than the loss volume due to some large - scale plants operating at full capacity [13][15] - **Downstream Demand**: As of June 26, the average weekly operating rate of MTO plants in the Jiangsu and Zhejiang regions was 80.13%, a 3.40 - percentage - point decrease from the previous week. The capacity utilization rates of dimethyl ether, glacial acetic acid, and chlorides increased, while those of formaldehyde decreased slightly [16][18] - **Inventory**: As of June 25, the inventory of Chinese methanol sample production enterprises was 341,600 tons, a 7.02% decrease from the previous period, and the order backlog was 240,700 tons, a 12.08% decrease. The port sample inventory was 670,500 tons, a 14.34% increase [20][23] - **Profit**: Last week, the average weekly profit of domestic methanol samples showed different trends. Coal - based methanol profits generally narrowed, while the economics of coke - oven gas - based and natural - gas - based methanol improved [24] 3.3 Methanol Trend Outlook - **Supply**: This week, methanol plant overhauls are more than restarts. It is expected that China's methanol output will be about 2.0052 million tons, with a capacity utilization rate of about 88.98%, a decrease from last week [30] - **Downstream Demand**: The olefin industry's operating rate is expected to continue to decline. The capacity utilization rate of dimethyl ether is expected to remain flat, that of glacial acetic acid is expected to increase, and those of formaldehyde and chlorides are expected to decrease [31][34] - **Inventory**: The inventory of Chinese methanol sample production enterprises is expected to be 354,900 tons, a slight increase from last week. Port inventory is expected to decline as the import apparent demand may remain weak [34]

Group 1: Stock Performance and Risks - Huayang New Materials (600281.SH) has experienced significant stock price fluctuations, with a cumulative increase that deviates from the industry average, indicating potential irrational speculation risks [1] - The company clarified that its main business does not involve rare earth permanent magnets, focusing instead on precious metal recovery and processing, which is facing rising raw material costs due to increasing precious metal prices [1] - Jinniu Chemical (600722.SH) reported that its methanol sales prices have not changed significantly despite a 20% increase in stock price over three trading days, indicating stable market conditions [4] Group 2: New Product Developments - Guoxin Technology (688262.SH) successfully tested its new quantum-resistant password card, CCUPHPQ01, and has sent samples to multiple clients for application development [2] - Rongchang Biopharmaceutical (688331.SH) received orphan drug designation from the EU for its product Tai Itasip, which is the first dual-target fusion protein drug for treating myasthenia gravis, providing policy support for its development in the EU [8] Group 3: Corporate Actions and Financial Updates - Lakala (300773.SZ) is in discussions regarding its H-share listing, which faces significant uncertainty in approval and regulatory processes [3] - Dematech (688360.SH) entered a strategic cooperation agreement with Shanghai Zhiyuan New Technology to explore innovative applications of embodied intelligent robots in logistics [9] - Yashi Chuangneng (603378.SH) announced a potential forced reduction of 3% of its shares due to a margin call affecting its major shareholder [10] - Siwei Technology (688213.SH) reported a decrease in the shareholding ratio of its major shareholder, the National Integrated Circuit Industry Investment Fund II, from 7.35% to 6.99% [11] - Jingyi Equipment expects a revenue increase of 36.54% to 42.48% year-on-year for the first half of 2025, projecting revenue between 690 million to 720 million yuan [12]

Core Viewpoint - The domestic green methanol refueling business has made significant progress, with Hong Kong and China Gas Company successfully completing a large-scale refueling operation for the Korean vessel "HMM Green" using green methanol produced in Inner Mongolia, marking a milestone in the green energy sector in Asia [1][2]. Group 1: Production and Certification - The green methanol was produced by the company in its facility located in Ordos, Inner Mongolia, utilizing biomass resources and urban waste, and has achieved ISCC-EU certification, demonstrating a 70% reduction in greenhouse gas emissions over its lifecycle [1][3]. - The company has been awarded the EU ISCC EU and ISCC PLUS international certifications for three consecutive years since 2022, making it the first enterprise in mainland China to achieve these certifications for large-scale green methanol production [3]. Group 2: Industry Context and Future Outlook - In line with global carbon neutrality goals, the latest strategy for reducing greenhouse gas emissions from shipping aims for a 20% reduction by 2030 and a 70% reduction by 2040 compared to 2008 levels, positioning green methanol as a preferred option for the shipping industry to lower emissions [3]. - The company plans to continue collaborating with various partners to advance the research and production of green methanol, contributing to the popularization of green energy and the sustainable development of the global shipping industry, with a projected production capacity of 150,000 tons by 2025 [3].