Often described as the “simplest alcohol,” methanol (CH₃OH) is one of the most versatile chemicals in the global economy. While not fit for direct human consumption like ethanol, methanol has carved out an essential role across energy, chemicals, and manufacturing. From fuels and plastics to paints and adhesives, methanol’s story reflects both industrial progress and the ongoing push for cleaner, more sustainable alternatives.
A Brief History of Methanol
Methanol was first isolated in the 17th century by distilling wood, earning it the name “wood alcohol.” For centuries, this destructive distillation process provided only small volumes, limiting its applications.
It wasn’t until the 1920s, with the rise of coal and natural gas chemistry, that large-scale methanol production became possible. Using catalytic synthesis from carbon monoxide and hydrogen (syngas), methanol transitioned from a curiosity to a cornerstone of the chemical industry. Today, nearly all methanol is made from natural gas, though interest in renewable “green methanol” is rapidly growing.
How Methanol Is Made
Modern methanol production relies on synthesis gas derived from fossil or renewable sources:
- Natural Gas Reforming – the dominant method, reforming methane with steam or oxygen to create CO and H₂, which are catalytically converted to methanol.
- Coal Gasification – common in China, where coal reserves are abundant, syngas is produced from coal instead of natural gas.
- Biomass Gasification – an emerging pathway, using waste biomass to produce renewable methanol.
- CO₂-to-Methanol – innovative processes capture carbon dioxide and hydrogenate it to methanol, offering a circular economy solution.
This flexibility makes methanol a unique platform chemical – able to be produced from fossil fuels today and renewables tomorrow.
Considerations When Sourcing Methanol
Methanol’s global significance comes with important sourcing considerations:
- Quality Grades:
- Industrial Grade – used in fuel, resins, formaldehyde, and general chemical production.
- Refined Grade – tighter impurity specifications for sensitive applications (e.g. acetic acid production).
- Specialty Grades – ultra-pure methanol for electronics and laboratory use.
- Safety and Toxicity: Methanol is toxic to humans if ingested, inhaled, or absorbed, requiring strict handling protocols and packaging compliance.
- Supply Chain Volatility: Linked to energy markets, methanol pricing can fluctuate with natural gas, coal, and crude oil dynamics. Trade flows are also highly sensitive to tariffs, shipping availability, and regional demand shifts.
Where Methanol is Used Today
Methanol’s versatility lies in its ability to serve both as a fuel and a chemical building block:
- Energy & Fuels
- Blended into gasoline (MTBE, bio-methanol blends)
- Direct fuel for methanol-powered ships, vehicles, and power plants
- Feedstock for biodiesel via transesterification
- Chemicals & Materials
- Formaldehyde production – used in resins, plywood, paints, and adhesives
- Acetic acid and olefins – building blocks for plastics and synthetic fibres
- Methylamines, methyl methacrylate, and solvents
- Specialty Applications
- Antifreeze and windshield washer fluids
- Pharmaceuticals (as a reagent, not an excipient)
- Fuel cells – methanol-based fuel cells for portable and stationary power
Future Opportunities and Risks
Opportunities:
- Green Methanol: Rapid growth in bio-methanol and e-methanol (from CO₂ + green hydrogen) as sustainable fuels for shipping and aviation.
- Marine Fuel: With IMO 2020 and upcoming decarbonisation targets, methanol is gaining traction as a lower-carbon marine fuel.
- Circular Economy: CO₂-to-methanol technologies align with global climate goals, potentially transforming waste emissions into valuable feedstock.
Risks:
- Health and Safety: Toxicity concerns limit methanol’s direct consumer use and require strict safety controls.
- Feedstock Dependence: Heavy reliance on fossil fuels for production exposes methanol to energy price volatility.