IOL Weekly Report: Continued Exploration of Refrigerant Expansion Fluoropolymer Pressure Maintaining Stability

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One week market
Refrigerant: Rising costs combined with strong demand, prices continue to explore upward trends
This week, refrigerant costs have risen and downstream demand is strong, supporting high price operations. Market characteristics of the week: The prices of raw materials fluctuate, but the prices of basic raw materials such as fluorite powder, hydrofluoric acid, and methanol are all experiencing upward movements, while the prices of other raw materials are mainly subject to narrow fluctuations. From the perspective of refrigerant production and sales scale, since the quota management of HFCs this year, the production and sales scale has remained weak in January due to export license restrictions and February due to the impact of the Spring Festival holiday. In March 2024, according to data from the China Association of Automobile Manufacturers, the production and sales of automobiles reached 2.687 million and 2.694 million, respectively, with a year-on-year increase of 4% and 9.9%. In addition, according to industry online data, the production of household air conditioners in March was 21.808 million units, a year-on-year increase of 23.4%; Sales of 22.429 million units, a year-on-year increase of 21.6%; The year-on-year increase in production scale from April to June is expected to be over 19%. Due to the downstream market entering the peak season of production and sales, the rapid growth in demand for refrigerants has led to a tight supply of goods in the market. It is expected that under the influence of multiple favorable factors such as cost, supply, and demand during the peak season, the prices of refrigerants will continue to remain high and consolidate in the future.

Fluorinated polymers: supply and demand contradictions determine price trends. Most products maintain stable operation
This week, the fluoropolymer market continued to have loose supply, weak demand, and limited cost support, putting pressure on mainstream products to maintain stable operation. Although the month on month price increase of basic raw materials such as fluorite, chloroform, liquid chlorine, methanol, and sulfuric acid has strengthened the support for monomer raw material products R22 and R142b from the cost side, the negative impact of overcapacity is still the main reason for the market downturn. Full competition, loose supply, and bottoming out prices have determined the dilemma of rising and falling prices for mainstream fluorinated polymers. Product prices will continue to be sold at low levels, and the future market will be accompanied by industry reshuffle and slow recovery in downstream application industries.

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Weekly News
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Proposed 3500 tons/year rare earth fluoride project for Baofu New Materials
On April 11th, the Ecological Environment Bureau of Sanming City accepted the environmental impact assessment document for the annual production of 3500 tons of rare earth fluoride project by Sanming Baofluorine New Material Technology Co., Ltd., and made the acceptance situation public. According to the environmental impact assessment documents, the total investment of the project is 106.507 million yuan, and it is planned to be completed and put into operation in 12 months. The main product to be produced is rare earth fluoride, with an annual output of 3500t/a, and a by-product of about 785t/a of hydrofluoric acid.
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Juhua Group: In 2023, it achieved a year-on-year decrease of 3.88% in operating revenue of 20.655 billion yuan
On April 17th, Juhua Group disclosed its 2023 annual report. During the reporting period, Juhua Group achieved a revenue of 20.655 billion yuan, a year-on-year decrease of 3.88%, and a net profit attributable to shareholders of the listed company of 944 million yuan, a year-on-year decrease of 60.37%. In terms of products, in 2023, Juhua Group's main business, refrigerant revenue was 5.983 billion yuan, a year-on-year decrease of 12.21%, accounting for 28.97% of operating revenue; Basic chemical products and other revenue amounted to 4.125 billion yuan, a year-on-year decrease of 15.33%, accounting for 19.97% of operating revenue; The revenue from petrochemical materials was 2.508 billion yuan, a year-on-year increase of 48.35%, accounting for 12.14% of the operating revenue; The revenue of fluoropolymer materials was 2.207 billion yuan, a year-on-year decrease of 11.54%, accounting for 10.69% of the operating revenue.
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Guohong Fluorochemical's annual production of 2500 tons of R227ea project is expected to be put into operation by the end of May
On April 18th, the Ecological Environment Bureau of Changde City planned to approve the Environmental Impact Assessment Report for the Annual Production of 2500 tons of Heptafluoropropane and 1000 tons of Heptafluorobromopropane by Hunan Guohong Fluorination Science Co., Ltd., and issued relevant public announcements. The project is planned to invest 48 million yuan and is scheduled to be completed and put into operation in May 2024. After the renovation, the product plan and production capacity of the entire factory are: 500t/a of difluoromethane, 2500t/a of heptafluoropropane, 1000t/a of heptafluorobromopropane, and 2800t/a of by-product hydrochloric acid.
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Acceptance of Hunan Anneng Qisheng New Energy 50000 ton battery grade lithium carbonate project
On April 15th, the Ecological Environment Bureau of Chenzhou City accepted and publicly announced the Environmental Impact Assessment Report (Phase I) of Hunan Anneng Qisheng New Energy Technology Co., Ltd.'s annual production of 20GWh energy storage batteries and supporting battery new materials construction project. According to the report, in order to support the project of a 30 million ton annual raw ore processing production line and a 3 million ton annual lithium concentrate beneficiation plant, Hunan Anneng Qisheng New Energy plans to construct a battery grade lithium carbonate with an annual output of 50000 tons, a 20GWh energy storage battery with an annual output, 50000 tons of lithium iron phosphate, and new materials for supporting batteries. The first phase of construction will have an annual output of 50000 tons of battery grade lithium carbonate (the content of this phase of construction); The second phase of construction includes an annual production of 20GWh energy storage batteries, 50000 tons of lithium iron phosphate, and new materials for supporting batteries.