The global methanol market has posted steady growth in recent years and is expected to expand further at a CAGR of 2.2% over the 2026 to 2030 period. China stands at the forefront of global methanol demand and is likely to account for about 70% of the global demand in 2026, far exceeding any other country.

China’s growth rapidly stems from expanding the petrochemicals sector and the country’s strategic investment in technologies such as methanol-to-olefins (MTO), which convert methanol into essential chemicals for plastics and textiles. The Chinese Government has also actively promoted methanol as a clean alternative fuel, especially in regions with limited access to natural gas, increasing methanol’s use in transportation and energy applications.

The leading position of China in global methanol demand is also attributed to the domestic availability of coal—a key feedstock for methanol production. This abundant, cheap feedstock has enabled China to scale up both capacity and consumption, making it less dependent on traditional oil-derived chemicals. Industrial policies, environmental regulations, and the ambition to diversify energy sources have further solidified methanol’s prominence in China’s chemical supply chain.

The US and India follow next in global methanol demand, while ranking second and third globally. They are expected to register a significantly lower demand of 8.65mtpa and 3.59mtpa, respectively, for 2026. The consumption in the US is mainly driven by its large petrochemicals industry, which relies on methanol as a key feedstock for a wide range of chemical products. On the other hand, the methanol demand growth in India is primarily led by rapid industrial growth, coupled with government initiatives promoting methanol as an alternative fuel and chemical feedstock.

Further details of global methanol capacity and CapEx analysis can be found in GlobalData’s new report, ‘Global Methanol Market: Key Projects and Capacity Additions, 2026’.