Hydrogen is produced in a compact methanol-steam reformer, which integrates an inner cylindrical heating chamber; and a reactant vaporizer and heating zone, and an outer Cu/ZnO/Al.sub.2O.sub.3 catalyst bed in concentric annuli around the heating chamber. Tubular, palladium-silver alloy membranes in the catalyst bed separate hydrogen from retentate gas, which is separately discharged from the apparatus through a manifold.