IOL Fluorochemical Weekly Report: High load refrigerant prices in the air conditioning industry remain firm

One week market
Refrigerant: High load production in the air conditioning industry supports short-term market stability
This week, refrigerant production and sales are good, and prices are running steadily. Market characteristics: Upstream raw material fluorite powder is tight and stable in price, while hydrofluoric acid production and sales are still acceptable, with prices temporarily stable; The overall production and sales of other raw material products have improved, with prices rising more and falling less. However, the current refrigerant market prices are mainly affected by supply and demand, and small fluctuations in costs have little impact on their prices. Since the implementation of quota production for HFC refrigerants in 2024, the concentration of the supply side industry has been high, and the discourse power is concentrated in several mainstream factories with relatively large quota quantities, such as Juhua, Sanmei, Sinochem, Dongyue, Yonghe, Dongyangguang and Meilan. The relatively tight supply has led to a strong mentality of reluctance to sell in factories, and the phenomenon of "production based on sales" is common. The current industry operating rate remains at 70-80%. According to Industry Online statistics, the year-on-year increase in household air conditioning production in March exceeded 10%, and downstream production and sales are expected to continue to raise the prices of mainstream refrigerants R32, R410A and other products. R22 has a relatively rigid demand but with a quota reduction of more than 30000 tons within the year, and the main trend is to explore stable prices in the future. The sentence is:. Overall, with limited industry supply and steady growth in downstream demand, it is expected that refrigerant prices will continue to rise in the future.

Fluorinated polymers: Lithium battery companies significantly expand production of lithium battery materials, and the supply-demand imbalance is expected to improve
This week, the mainstream TFE series, VDF series, and HFP series products in the fluoropolymer market continued to have loose supply and maintained stable prices. The current market characteristics are as follows: upstream material factories are slowing down their production expansion, while downstream lithium battery companies still have a 60% year-on-year capacity expansion plan this year. In addition, the demand for replenishment by battery companies in the first quarter has boosted the sales of battery raw materials such as PVDF and electrolytes. However, the overall supply and demand relationship is still weak, and the upward support on the cost side is limited. The slowdown in global economic growth is affecting traditional demand, with new areas of demand such as: AI+、 The new quality productivity fields such as data centers and cloud computing are still in the early stages of explosive growth, and the short-term market for fluorinated polymers will remain in a low game and wait for a significant improvement in demand.

This Week
01Juhua Corporation: There is no quota constraint for the fourth generation fluorine refrigerant
Recently, Juhua Corporation responded to investors' questions on an interactive platform. The company stated that the fourth generation fluorine refrigerants (HFOs, hydrofluoroalkenes) have zero ODP, low GWP, short atmospheric residence time, and stable chemical properties. They are currently considered ideal alternatives to HFCs. Apart from our company, there are a few domestic enterprises that produce and operate fourth generation fluorine refrigerants on a large scale. At present, there is no quota constraint for the fourth generation fluorine refrigerants. The 35000 ton tetrafluoropropene project laid out by the company accounts for less than 4% of the current quota of second-generation and third-generation fluorine refrigerants in China. Therefore, there is no quota guarantee and there is also a vast potential market demand in the future.

02Dongyang Guang plans to establish a joint venture with Zhongji Xuchuang to jointly layout the liquid cooling industry chain
On March 1st, Guangdong Dongyang Technology Holdings Co., Ltd. (Dongyang) disclosed that the company held a board meeting to review and approve the proposal to establish a joint venture with Zhongji Xuchuang Co., Ltd. According to the announcement, Guangdong Dongyangguang Liquid Cooling Technology Co., Ltd. (Liquid Cooling Technology), a wholly-owned subsidiary of Dongyangguang, and Zhongji Xuchuang Co., Ltd. (Zhongji Xuchuang) will jointly establish a joint venture company, Guangdong Shenlin Intelligent Cooling Technology Co., Ltd. (Joint Venture), with Liquid Cooling Technology contributing 49 million yuan and holding a 49% stake; Zhongji Xuchuang has subscribed a capital of 51 million yuan and holds a 51% stake. The joint venture will focus on the global promotion of liquid cooling and heat management solutions and products.

03Arkema invests $20 million to expand 15% PVDF production capacity at its US base
Arkema announced on February 26th that it will invest approximately $20 million in its production facility in Calvert, Kentucky, with plans to expand its polyvinylidene fluoride (PVDF) production capacity by 15%. This expansion plan is expected to be implemented in mid-2026, with a focus on launching innovative PVDF grades to meet the growing demand for high-performance resins for lithium-ion batteries in the local market, as well as the expanding semiconductor and cable markets. In recent years, Arkema has actively promoted multiple expansion plans worldwide. At the beginning of 2021, the company announced a 35% increase in fluoropolymer production capacity at its Changshu base in China, and will expand the growth rate to 50% by 2022. The launch of new production capacity is planned to be achieved by the end of 2022. In addition, Arkema announced in November 2021 that it will upgrade the Kynar at its Pierre-B é nite factory ® PVDF fluorinated polymer production capacity of 50% to meet the rapidly growing demand for lithium-ion battery materials. Currently, both projects have been successfully put into operation.

04Environmental Impact Assessment Announcement for the First Phase of Fluorine Material Integration in Qianxi City (1500 Tons of Perfluoropolyether and Fluorinated Liquid)
Recently, the People's Government of Qianxi City released the environmental impact assessment for the first phase of Guizhou Sino New Materials Technology Co., Ltd.'s fluorine material integration project (1500 tons of perfluoropolyether and fluorinated liquid). The project is located in the chemical park of Qianxi Economic Development Zone, Bijie City, Guizhou Province, with a total investment of 284.56 million yuan. It plans to construct 600 tons/year perfluoropolyether unit, 200 tons/year PPVE unit, 200 tons/year perfluoropolyether carboxylic acid unit, 100 tons/year perfluoropolyether amine unit, 200 tons/year electronic grade perfluoropolyether unit, 200 tons/year fluorinated liquid unit, fluorine nitrogen mixer unit and supporting facilities.