Iran's MEKPCO Methanol Plant Hits Full Output After Seven-Month Halt

Iran's Marjan Petrochemical Company (MEKPCO) has brought its methanol plant in Bandar-e Mahshahr back to 100 percent operating rate, ending a production stoppage that lasted nearly seven months. The unit had been idled on November 25, 2025 after natural gas feedstock supplies were cut, part of a broad wave of winter gas rationing that forced most Iranian methanol producers offline during the colder months.

The shutdown was not an isolated event. By mid-January 2026, Iranian methanol facilities were running at only about 16 percent of their combined capacity, with more than 80 percent of local plants sitting idle as the government diverted scarce gas to household heating. Marjan was one of the largest casualties of that policy, joining a long list of Mahshahr and Assaluyeh complexes that suspended operations through the winter peak.

The feedstock crisis arrived at the same time as a far larger shock to global trade. Since late February 2026, the threat and intermittent closure of the Strait of Hormuz has disrupted the main export route for Iranian methanol, lengthening loading and transit times and reducing arrivals at Chinese ports. The combination of frozen production at home and a choked shipping lane abroad pulled Iranian methanol shipments to China down sharply through the first quarter, with January cargoes falling to roughly 275,000 tons.

Recovery began as winter gas restrictions eased. By early April 2026, several major producers including Zagros, Fanavaran and Bushehr had already resumed output, while Kharg and Marjan were reported to be in the process of restarting. Those facilities together represent close to half of Iran's total methanol capacity, and their gradual return helped calm fears of a prolonged supply gap.

Marjan has now completed that recovery. As of June 18, 2026, the plant is confirmed running at its full 100 percent rate, marking a return to normal operations after the gas-driven halt. The restart adds meaningful volume back into a market that had grown accustomed to tight Iranian supply, and it reinforces the broader recovery seen across the country's petrochemical sector in recent weeks. Iran's Kaveh Methanol complex, the largest single methanol producer in the world, also restarted in early June using a domestically produced synthesis catalyst.

Methanol is a foundational building block for the chemical industry, feeding into formaldehyde, acetic acid, olefins through methanol-to-olefins units, and a range of solvents and resins. Iran is one of the world's largest methanol exporters, and China is by far its biggest customer. Disruptions to Iranian supply ripple quickly through Chinese port inventories and into downstream olefin margins, which is why traders watch the operating status of plants like Marjan so closely.

The return to full output does not fully neutralize the risk that hangs over Iranian exports. The Strait of Hormuz remains the central logistical uncertainty, and the ability to actually load and ship product out of the Gulf is as important as the ability to produce it. During the strait's tightest period only a handful of methanol vessels managed to pass through to China, carrying around 140,000 tons in total. While controls have loosened somewhat in recent weeks, allowing more Iranian cargoes through, the route stays vulnerable to renewed tension.

For now, the MEKPCO restart is a clear sign that the production side of Iran's methanol crisis has largely passed. With winter gas rationing over and major units back online, the focus shifts back to logistics and to whether stable shipping through Hormuz can sustain the recovery in exports to Asia.