Fluorochemical weekly report: Refrigerant prices continue to rise, industry concentration further increases
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One week market
Refrigerant: Industry concentration further increases, factory confidence in price increases
This week, due to the factory's reluctance to sell at high prices, mainstream refrigerant prices have remained strong, and HFC-125 prices have risen again, synchronously driving up the corresponding mixed refrigerant prices. Market characteristics of the week: Affected by weak demand, the contraction of production and sales has led to fluctuations in the prices of upstream basic raw materials, with prices of fluorite powder and hydrofluoric acid falling narrowly and refrigerant cost pressures weakening. Entering December, there are relatively few domestic and international orders for refrigerants, and overall production and sales are relatively weak. Most factories are delivering old orders, but the HFCs refrigerant quota policy is clear, and the supply is expected to tighten in 2024. On December 5th, Juhua announced plans to acquire 51% of Feiyuan's shares, which will further increase industry concentration. It is expected that under the influence of positive factors such as favorable policies and limited supply next year, the refrigerant market will maintain stable and consolidated operation within the year.
Fluorinated polymers: weak supply-demand relationship, factories reduce production and maintain prices
This week, factories in the fluorinated polymer market reduced production and maintained prices, continuing a low and stable trend. Cost support and downstream demand were equally weak and maintained. The overall oversupply determined that the fluorinated polymer market will continue to consolidate deeply at the bottom in the short term. From a product perspective, the core monomer raw material products R22 and R142b are also facing weakened cost support and hindered downstream demand. The simultaneous decline in volume and price across the entire industry chain has put collective pressure on the TFE and VDF series. Considering that product prices are approaching the cost line, there is not much room for further price reductions in the future, and the entire range of fluoropolymer products will continue to operate steadily.
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Weekly News
Refrigerant&Fluorine Raw Materials
Juhua plans to acquire 51% equity of Feiyuan to consolidate its leading position in the industry
On the evening of December 5th, Juhua Group announced that Zhejiang Juhua Co., Ltd. plans to acquire 54.696033 million shares of the target company held by some old shareholders of Zibo Feiyuan Chemical Co., Ltd. through cash contribution, and unilaterally increase the registered capital of the target company by 77.218322 million, a total of 51% equity of the target company.
Juhua Shares stated that the main purpose and reasons for this transaction are:
1. Give full play to the integration effect of the synergy between our company and Feiyuan Chemical Industry Chain, complementary resource advantages, and complementary market space layout, and enhance the competitiveness level of both parties
2. Enriching our company's industrial chain, strengthening, optimizing, and expanding our core industries, enhancing our competitiveness and market competitiveness, promoting high-quality development, and enhancing our profitability
The main business of Feiyuan Chemical is the research and development, production, and sales of basic chemical raw materials, fluorine chemical raw materials, and subsequent products. The company has a relatively complete fluorine chemical and epoxy resin industry chain, with a rich product line: its main products include refrigerant difluoromethane (R32), pentafluoroethane (R125), tetrafluoroethane (R134a), R410A, R404A, R407C, R507; Fine chemicals R113a, trifluoroacetic acid, trifluoroacetyl chloride, trifluoroethanol, thiol chloride; Other products include hydrogen fluoride, ammonium hydrogen fluoride, sulfuric acid, epichlorohydrin, epoxy resin, etc
According to industry online estimates, in the upcoming HFC refrigerant production quota, Feiyuan Chemical's HFC refrigerant products, including difluoromethane (R32), pentafluoroethane (R125), and tetrafluoroethane (R134a), all have quotas in the top five of the industry. If the acquisition is completed, Juhua Group's discourse power in the third-generation HFC refrigerant market will be further enhanced, and some products are expected to have a market share of 40%.
Jinshi Resources: Baosteel Jinshi has a daily production of 2000 tons of fluorite powder, and the Jin'ebo project has a daily production of 200 tons of hydrofluoric acid
On November 29, 2023, Jinshi Resources held a performance briefing and the company provided responses to issues of concern to investors.
At the meeting, Jinshi Resources stated that there are a total of three production lines for Baosteel's Jinshi beneficiation. Among them, the two production lines "processing 1.5 million tons of rare tailings annually" and "processing 2.6 million tons of rare tailings with iron tailings annually" have basically reached full capacity. The third production line "processing 1 million tons of iron tailings annually" started trial production in August this year and currently has reached 50% capacity. Currently, the three production lines can produce over 2000 tons of fluorite powder per day, with an overall yield of about 80%.
The hydrofluoric acid project in Jin'ebo has four production lines with a total capacity of 120000 tons in the first phase, each with a production capacity of 30000 tons. Now, all four lines have undergone trial production, and the equipment is gradually being adjusted and optimized. Currently, it can produce over 200 tons of hydrofluoric acid products per day; The second phase of 180000 tons of hydrofluoric acid, including a portion of flexible aluminum fluoride production lines, remains unchanged from our previous plan and is planned to be completed by the end of the year. That is to say, by the end of this year, the production capacity of 300000 tons of hydrofluoric acid will be fully completed for trial production, but the specific progress of capacity ramp up will depend on equipment debugging and market conditions. After the production capacity is fully completed, we will arrange the product sales structure based on market conditions, and the products sold to the outside world include fluorite powder, hydrofluoric acid, and aluminum fluoride products.
Fluorinated polymers
Sichuan Zhongfluorine's annual production of 13000 tons of high-purity electronic grade gas project has officially started construction
According to the Economic and Information Bureau of Ya'an City, the annual production of 13000 tons of high-purity electronic grade gas project of Sichuan Zhongfluoroenergy New Material Technology Co., Ltd. has officially started construction recently.
The project has a total investment of 500 million yuan and is located in Ya'an Economic Development Zone. The construction includes:
A 5000 ton/year high-purity sulfur hexafluoride production line simultaneously produces 40% hydrofluoric acid and hydrogen gas as by-products;
A 2500 ton/year carbon tetrafluoride production line simultaneously produces 40% hydrofluoric acid and hydrogen as by-products;
A 5000 ton/year nitrogen trifluoride production line simultaneously produces 40% hydrofluoric acid, nickel hydroxide, and hydrogen gas as by-products;
One 300 ton/year octafluoropropane production line simultaneously produces hydrogen gas, 40% hydrofluoric acid, and perfluorohexane as by-products;
A 200 ton/year fluorine gas mixture production line simultaneously produces 40% hydrofluoric acid as a byproduct.
Sichuan Zhongfluoroenergy New Material Technology Co., Ltd. was established in May 2022, located in Ya'an Economic and Technological Development Zone. It is a professional enterprise engaged in the production of high-purity gases such as sulfur hexafluoride, electronic grade carbon tetrafluoride, nitrogen trifluoride, octafluoropropane, and fluorine gas mixtures.
Jiangsu Rudong plans to build two fluorine containing pesticide intermediate projects
On November 3rd, Jiangsu Kuaida Agrochemical Co., Ltd. announced the glyphosate soluble liquid agent (water-based) and benzoyl chloride technology renovation project. The project is located in the western area of Yangkou Chemical Industrial Park, Rudong County, with a total investment of 620 million yuan. It will construct a 18200 ton pesticide intermediate project, including 1000 tons of pyrfluazuron and 500 tons of fluthiacloprid.
On November 8th, the annual production of 1950 tons of raw materials by Jiangsu Ruibang Agrochemical Co., Ltd. was announced. The project is located in Yangkou Chemical Industrial Park, Rudong County, Jiangsu Province, with a total investment of 340 million yuan. It will construct a 1950 ton pesticide intermediate project, including 200 tons of fluazuron and 200 tons of difluorosulfonate.
Saudi Arabia launches anti-dumping investigation on textiles or fabric products coated with polyvinyl chloride related to China
On November 30, 2023, the Saudi Arabian General Administration of Foreign Trade issued Announcement No. AD-23-2, stating that in response to the application of Saudi domestic enterprises, an anti-dumping investigation will be initiated against textiles or fabrics coated with PVC originating from or imported from China and South Korea. The dumping investigation period in this case is from July 1, 2022 to June 30, 2023, and the injury investigation period is from January 1, 2020 to June 30, 2023. The Saudi tax codes for the products involved are 39269061 and 59031000.
