IOL Weekly Report: Slight Adjustment of Production Quota among Refrigerant Enterprises, Market Continuation and Stability Maintenance

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One week market
Refrigerant: Slight adjustment of production quotas between enterprises, overall market continues to maintain stable operation
On June 13, 2024, the official website of China's Action to Protect the Ozone Layer disclosed the announcement of the adjustment of production quotas for HCFCs and HFCs in 2024. According to the announcement, there was no change in the total production quota of HFCs refrigerants in China for the whole year of 2024, all of which were quota adjustments between enterprises. Overall demand remained stable during the week, and the refrigerant market maintained stable operation. This quota adjustment mainly involves products R32, R134a, R125, R22, and R142b, respectively. Weekly market characteristics: The overall transaction of upstream raw material products is average, with narrow fluctuations in prices and little change in refrigerant product costs. R32, as the mainstream refrigerant product in the new air conditioning market, is temporarily stable in price due to the unequal impact of downstream procurement and refrigerant factory production; In addition, with the growth of after-sales demand and the expected impact of significant cuts next year, the R22 factory has strong confidence and continued high prices; The supply and demand market for other refrigerant products is relatively stable, and prices are temporarily stable. Overall, influenced by the different production and sales situations of downstream application industries, the differentiation characteristics of various refrigerant products are obvious, and it is expected that the refrigerant market will operate in a narrow range in the short term.

Fluoropolymers: Factories reduce production, maintain prices, and increase prices. Prices are consolidating at a low level
This week, the fluoropolymer market experienced a weak balance between supply and demand, with mainstream products maintaining stability and consolidation. From the perspective of the industrial chain, the weakness of downstream production and sales is transmitted to the upstream of the industrial chain, and the high prosperity of basic products such as fluorite powder and hydrofluoric acid has decreased in the early stage; The midstream organic fluorine monomer products R22 and R142B continue the differentiated market trend of ice and fire, with a strong and rising controlled use market. The raw material use is facing dual pressures from upstream and downstream, and continues to operate near the cost line; The growth rate of downstream application industries has significantly slowed down, reflecting that the end market is dominated by on-demand procurement by product processing enterprises. Overall, the current market for fluoropolymer factories has obvious characteristics of reducing production and maintaining prices. TFE series and VDF series products are in a dilemma of rising and falling, and will continue to consolidate at a low level.     

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Weekly News
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Analysis of the adjustment of production quotas for hydrofluorocarbons (HFCs) in 2024
On June 13th, the Compliance Department of the Center for Foreign Cooperation and Exchange of the Ministry of Ecology and Environment (Compliance with the Convention on Substances that Deplete the Ozone Layer) issued a public notice on the adjustment of production quotas for hydrochlorofluorocarbons and hydrofluorocarbons for 13 enterprises, including Akoma (Changshu) Fluorochemical Co., Ltd., in 2024. The total quota for HFC-32, HFC-125, and HFC-134a remains unchanged, with adjustments made to quotas between different enterprises. Quzhou Fluorochemical and Dongyue Green Cold HFC-32 production quotas have decreased, while Feiyuan, Taixing Meilan, and Inner Mongolia Yonghe quotas have correspondingly increased; Quzhou Fluorochemistry and Taicang Zhonghua HFC-134a production quotas have decreased, while Feiyuan, Taixing Meilan, and Dongyangguang quotas have correspondingly increased; Quzhou Fluorochemical Akoma, Dongyue Polymer, and Meilan HFC-125 production quotas have decreased, while Feiyuan, Dongyangguang, Taicang Zhonghua, and Dongyue Green Cooling quotas have correspondingly increased.
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Jiangxi Changxinrui Investment in the Construction of Fluorine Chemical New Materials Project
On June 5th, the People's Government of Hukou County released the draft environmental impact assessment report for the fluorine chemical new material project of Jiangxi Changxinrui Pharmaceutical Co., Ltd. for public consultation. The total investment of this project is 35 million yuan, of which environmental protection investment is about 18.26 million yuan. The plan is to build an annual production capacity of 1500 tons of tetrafluoroethyl ether, 1500 tons of tetrafluoroethyl trifluoroethyl ether, 5320 tons of polytetrafluoroethylene, 13749.1 tons of difluoromethane and 7788 tons of tetrafluoroethylene as intermediate products, and an annual production capacity of 10000 tons of anhydrous calcium chloride, 47195.957 tons of 38.3% calcium chloride solution, 1093.7 tons of 30% hydrofluoric acid (R22 production line), 2919.89 tons of 35% hydrofluoric acid (incinerator), 540 tons of 92.5% sulfuric acid, and 122 tons of hexafluoropropylene.
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Environmental Impact Assessment Announcement for the High end Fluorine New Materials Project (Phase I) of Tianci Materials Subsidiary
On June 12th, the Ecological Environment Bureau of Sanming City accepted the Environmental Impact Assessment Report for the High end Fluorine New Materials Project (Phase I) of Fujian Zhongzhou New Materials Technology Co., Ltd. The total investment of this project is 100 million yuan, with a new production capacity of 700t/a hexafluoroepoxy propane (for self use), 840t/a hexafluoroacetone trihydrate (for self use), 600t/a hexafluoroisopropanol (of which 200t/a is for self use), 200t/a hexafluoroisopropyl methyl ether, 155t/a perfluoro isobutyl methyl ether, 190t/a perfluoro pentyl methyl ether, 90t/a trifluoroacetate ethyl ester, 1500t/a perfluoro hexanone, and 80t/a hexafluoropropylene trimer; Co production of 30% hydrofluoric acid 80t/a, potassium sulfate 440t/a, methanol 73t/a, and sodium chloride 685t/a. The construction period is from July 2024 to June 2025.
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Duofuduo and Hubei Yihua signed a contract for the Huazhong Fluorosilicon Industrial Park project
On June 17th, Duofuduo, Yichang High tech Industrial Development Zone Management Committee, and Hubei Yihua jointly signed a framework cooperation agreement on the construction of the Duofuduoyihua Huazhong Fluorosilicon Industrial Park project. They unanimously agreed to establish a long-term, close, and pragmatic cooperation relationship, strengthen the upstream and downstream coordination of the Fluorosilicon industrial chain, and promote the construction of the Duofuduoyihua Huazhong Fluorosilicon Industrial Park project. The project plan uses fluorosilicic acid as the raw material and follows the value-added path of "fluorosilicic acid hydrofluoric acid fluorine fine chemicals fluorine electronic chemicals" to achieve efficient utilization of fluorine and silicon resources.
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Environmental Impact Assessment of Fujian Yonghong High tech Special Fluorosilicon Material Project (Phase II)
Recently, the Ecological Environment Bureau of Nanping City accepted and publicly announced the environmental impact assessment of the Yonghong High tech Special Fluorosilicon Material Project (Phase II) of Fujian Yonghong High tech Materials Co., Ltd. This project is a renovation and expansion project, located in the existing factory area of Qimu Platform in Jintang Industrial Park, Shaowu City. After completion, the entire factory will increase its production capacity of 100 tons of perfluoroether rubber per year, while the current production scale of 180 tons of Y-type perfluoroether per year will remain unchanged.