Fluorochemical Weekly Report: The contradiction of oversupply further manifests, and prices are poised to consolidate at low levels

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One week market

Refrigerant: Multi product prices hit bottom, consolidation demand urgently needs to be restored

This week, the production and sales of refrigerants in the market remained stable, and mainstream product prices hit bottom and fluctuated. Weekly market characteristics: Upstream basic raw material products are affected by weak industry demand, resulting in overall weak production and sales. Prices fluctuate with fluctuations of around 5%. Among them, the market of fluorite powder, hydrofluoric acid, Trichloroethylene and tetrachloroethylene remained weak and stable, the price of raw materials hit the bottom, and the cost support for refrigerant products became stronger. From a product perspective, as temperatures rise in multiple regions and the demand for air conditioning after-sales service increases, the production and sales of HCFC-22 have improved, and prices have remained high; The current domestic and international demand for HFCs refrigerants has not significantly boosted. Under supply and demand pressure, prices fluctuate narrowly, but there is limited room for further decline, with future stability and consolidation being the main focus. In the long run, due to the resurgence of the El Ni ñ o phenomenon this year, it is highly likely that high temperature weather will continue in the second half of the year. The demand for refrigerants in downstream areas such as air conditioning, refrigeration, and automobiles is expected to continue to grow, and companies have a strong upward mindset. In the short term, due to oversupply in the industry, the refrigerant market continues to operate under pressure and consolidation.

Fluorinated polymers: coexistence of supply and demand game and cost game, price consolidation at low levels

This week, oversupply in the fluoropolymer market remains the main reason for the continued downward trend. In a weak market environment, costs have been further compressed, and profit margins have also been squeezed out. The main characteristic of the current market is the urgent need to restore demand by reducing production and ensuring prices. From the perspective of the industrial chain, upstream basic products such as hydrofluoric acid, chloroform, calcium carbide, liquid chlorine, and other raw material prices are also facing difficulties such as a decline in profits, and there is little room for price decline. Raw material prices may hit the bottom, supporting the cost center of organic fluorine monomers TFE, VDF, HFP to stabilize, and corresponding fluoropolymers may receive strong support; In addition, after the double increase in the supply and demand of fluoropolymers such as PTFE, FEP, FKM, HFP, and PVDF, there is a significant differentiation in the supply-demand contradiction, which will depend on the speed of demand recovery in the application industry. In summary, it is predicted that the demand for fluorinated polymers in the future urgently needs to recover, and product prices may gradually reach a bottom and consolidate.

Fluorinated lithium salts: slow inventory accumulation, weak and stable market

At the beginning of the month, stimulated by the entry of the downstream market to replenish the inventory, the Lithium carbonate manufacturers have taken action to hold up the price. However, with the increase of the shipment volume of the salt lake and the flat demand of the downstream market, the overall price has fallen into a stalemate, and the actual transaction price is flexible. Under the shipping tone, hexafluoride enterprises control the operating load and strictly control inventory. Downstream electrolyte and positive electrode material factories saw a slight increase in production in July, but there was a certain accumulation of raw material inventory, resulting in limited incremental orders for lithium salts. Industry online estimates that the increase in Lithium carbonate shipments will limit its support for the cost of Lithium hexafluorophosphate, and with the limited downstream orders, the inventory will gradually accumulate, and the price of lithium fluoride salt may be weak.

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Weekly Highlights

Fluorine raw materials and refrigerants

400000 tons of electronic grade hydrofluoric acid and other projects are planned to settle in Zigong Yantan

On the afternoon of June 29th, the 12th Western China Investment Explanation Conference and Economic Cooperation Project Signing Ceremony were held in Chengdu. Above all, Zigong City successfully signed a contract with Fujian Yongjing Technology Co., Ltd. to produce 400000 tons of high-purity electronic chemicals and new fluorinated materials annually.

The project is located in the South Sichuan New Materials Chemical Industry Park, with a planned total investment of 5 billion yuan and an area of approximately 700 acres. After completion, it is expected to have an annual sales revenue of 6 billion yuan and an annual tax revenue of 420 million yuan. After completion, it can effectively fill the shortage of hydrofluoric acid projects in the upstream of the fluorine chemical industry, semiconductor and photovoltaic industries in the province, especially in electronic grade hydrofluoric acid projects.

The Ministry of Ecology and Environment solicited opinions on the "Management Measures for Voluntary Greenhouse Gas Emission Reduction Trading (Trial)"

On July 7th, the website of the Ministry of Ecology and Environment announced the "Management Measures for Voluntary Greenhouse Gas Emission Reduction Trading (Trial)".

The announcement states that after the launch of the national greenhouse gas voluntary emission reduction trading market, various social entities can independently and voluntarily develop greenhouse gas emission reduction projects in accordance with technical specifications such as project methodology. After the emission reduction effects generated by the projects are quantified and certified through scientific methods, they can be sold on the market and obtain corresponding emission reduction contribution benefits.

The Measures require that the emission reductions generated by eligible projects should be continuously stable, measurable, traceable and verifiable, and the certified voluntary emission reductions can be used for the national carbon Emissions trading market and local pilot carbon markets to offset the quota clearing, carbon neutrality of large-scale activities, etc. The "Measures" propose that the project owner and third-party review and verification institutions shall make a "dual commitment" to the authenticity and compliance of relevant projects and emission reduction materials, and the government shall conduct supervision and inspection. Among them, the review and verification institutions shall be subject to administrative approval by the State Administration for Market Regulation.

Fluoropolymer

Hunan Furui Proposed 5000t/a Fluorinated Fine chemical Project

On June 20, Yueyang Municipal Ecological Environment Bureau announced the 5000t/a fine chemical new material construction project of Yueyang Furui Material Technology Co., Ltd.

According to the public announcement, the project is located in Yueyang Green Chemical High tech Industrial Development Zone, with a total investment of 360.63 million yuan, including environmental protection investment of 36.61 million yuan.

There are a total of 5 production lines set up in the project:

One 4-Dimethylaminopyridine production line (producing 500t 4-Dimethylaminopyridine);

1 production line of benzyl hydrazine formate (producing 1000t of benzyl hydrazine formate and 372.8t of methanol);

One difluoropyrazolic acid production line (producing 2000t of difluoropyrazolic acid, 1133.28t of ethanol, 1188.96t of Dimethylamine, 3236.78t of Potassium fluoride by-product, 812.91t of sodium sulfate by-product);

1 production line of ethyl di Fluoroacetic acid (1000 t ethyl di Fluoroacetic acid, 2241.65 t Potassium fluoride as by-product);

One production line of trifluoropyrazole acid (500t of trifluoropyrazole acid, 126.72t of ethanol, 271.04t of Dimethylamine, 461.2t of Potassium chloride, 185.09t of sodium sulfate).

Shandong Jining Proposed 30000 tons/year Anhydrous Potassium fluoride Project

On May 4, Yutai County Branch of Jining Municipal Bureau of Ecological Environment announced the 30000 t/a anhydrous Potassium fluoride, reconstruction and expansion of 5000 t/a 2-chloro-5-chloromethylthiazole project of Jining Fushun Chemical Co., Ltd.

According to the public announcement, the project is planned to invest 100 million yuan and is located in the existing plant area of Jining Fushun Chemical Co., Ltd. in Yutai Zhanghuang Chemical Industry Park. After completion, the project will produce 30000 tons of Potassium fluoride and 5000 tons of 2-chloro-5-chloromethylthiazole annually. Among them, the 2-chloro-5-chloromethylthiazole unit reacts 2,3-dichloropropene with Ammonium thiocyanate to produce 2-chloropropenyl Isothiocyanate, and then produces 2-chloro-5-chloromethylthiazole through chlorine gas. All products are sold outside. According to the public information, Jining Fushun Chemical Co., Ltd., a wholly-owned subsidiary of Jining Kangsheng Rainbow Biotechnology Co., Ltd., has 1 methyl chloroacetate and Dichloroacetic acid methyl ester unit in its existing capacity

Fluorinated lithium salt

July 21, 2023! Lithium carbonate futures contract officially listed

On July 14, the Exchange issued a notice on the listing of Lithium carbonate futures contracts.

The notice said that the Lithium carbonate futures contract will be listed and traded from July 21, 2023 (Friday). The trading hours are from 9:00 to 10:15, 10:30 to 11:30, and 13:30 to 15:00 every Monday to Friday (excluding statutory holidays in Beijing time), as well as other times specified by the exchange. The handling fee for Lithium carbonate futures contract trading is 0.8% of the transaction amount, and the transaction handling fee is temporarily exempted for current position trading.

The first batch of listed trading contracts are LC2401, LC2402, LC2403, LC2404, LC2405, LC2406, and LC2407.

Yongtai Technology GDR successfully issued and raised approximately $70 million in total funds

On July 11, Yongtai Technology (002326) GDR was officially listed on the London Stock Exchange. The final price for this issuance of the company is $9.41 per GDR, with a total of 7.4389 million GDRs issued and 37.1945 million A-shares of underlying securities represented. The total amount of raised funds is approximately $70 million.

It is reported that about 70% of the funds raised by Yongtai Technology in this issuance will be used to strengthen the company's global industrial chain layout in core business areas such as new energy materials, medicine, and plant protection, and enhance product research and development, manufacturing, and sales capabilities; About 30% of the net amount raised this time will be used to repay the company's debts and supplement Working capital.

Time Easy Energy Storage and Lithium Battery Storage Comprehensive Utilization Project Signed at Guangdong Sihui

According to the Sihui Financial Media Center, on the morning of July 13, the signing ceremony of the cooperation agreement on the project of easy energy storage and comprehensive utilization of lithium battery storage in the era was held in the Fourth Conference of Zhaoqing, Guangdong.

The total investment of the Times Easy Energy Storage and Lithium Battery Storage Comprehensive Utilization Project is about 1 billion yuan, and it will apply to be included in the list of "Industry Standard Conditions for Comprehensive Utilization of Waste Power Batteries in New Energy Vehicles" issued by the Ministry of Industry and Information Technology of the People's Republic of China, as well as obtain dual qualifications for "cascade utilization" and "renewable utilization".

The same project will create a production line for battery physical crushing and battery electrode powder, a production line for cascade batteries (energy storage), and a production line for 2GWh electric vehicle battery packs (including shared electric bicycles); Establish a complete vehicle factory for electric exchange (sharing), a factory for producing electric exchange cabinets and equipment, and launch electric exchange (sharing) and platform construction; Set up Industrial internet of things and intelligent logistics supporting service base; Establish warehousing centers, distribution and distribution centers, and supply chain finance centers.

BYD expects a net profit of 10.5 billion yuan to 11.7 billion yuan in the first half of the year, an increase of about twice year-on-year

On the evening of July 14th, BYD (002594) released a performance forecast, predicting a net profit of 10.5 billion to 11.7 billion yuan in the first half of the year, a year-on-year increase of 192.05% to 225.43%; The net profit after deduction was 9.3 billion to 10.3 billion yuan, an increase of 207% -240% year-on-year.

Regarding the reasons for performance growth, BYD analyzed that in the first half of the year, the new energy vehicle industry maintained rapid growth, and the company's new energy vehicle sales achieved strong growth from a high base in the same period last year. The market share continued to increase, and it continued to strengthen its leadership position in the new energy vehicle industry.

BYD also mentioned that despite the intensification of competition in the automotive industry in the first half of the year, the company continues to maintain a good level of profitability thanks to its continuously improving brand power, expanding scale advantages, strong industry chain cost control capabilities, and a decline in upstream raw material prices.

According to data previously released by BYD, in the first half of the year, BYD sold a total of 1.2556 million vehicles, a year-on-year increase of 95.78%. Among them, BYD's cumulative sales of passenger cars reached 1.2482 million units. As of now, BYD has accumulated sales of over 4.6 million new energy vehicles. In terms of batteries, the cumulative installed capacity of BYD's new energy vehicle power batteries and energy storage batteries in the first half of the year was approximately 60.250GWh.