Tuesday, July 3, 2012

Domestic Price of HFC-134a to Keep Falling in The Next Three Months

In May 2012, the price of HFC-134a dropped to USD6,238/t, decreasing by 9.66% month on month, while it was about USD6,905/t in April 2012, decreasing by 0.25% month on month. The price decrease of HFC-134a was mainly influenced by the decreasing price of raw materials and weakened demand, according to CCM’s June Issue of China Fluoride Materials Monthly Report.

Firstly, the production cost of HFC-134a has been continuously reducing. Trichloroethylene (TCE) and anhydrous hydrofluoric acid (AHF) are the main raw materials of HFC-134a. From April 2012, both the prices of TCE and AHF kept falling.

The oversupply of TCE becomes intensified in China, because ShanDong Haike Chemical Group has been operating its production lines of TCE with capacity of 40,000t/a since the middle of April 2012. Simultaneously, the price of TCE in May 2012 dropped to USD1,003/t, decreasing by 6.52% month on month.

Moreover, affected by the fatigued market, the price of AHF has been decreasing continuously for eleven months since June 2011 when its price was USD1,851/t. In May 2012, the price of AHF was USD1,213/t, decreasing by 3.22% month on month.

Secondly, domestic demand of HFC-134a declined in April because its downstream consumption by automobile industry lowered. As the substitute of dichlorodifluoromethane (CFC-12), HFC-134a is a zero ODP refrigerant. It doesn't contain chlorine element, neither does it destroy the ozonosphere, thus it becomes the most widely-applied middle-and-low-temperature environment-friendly refrigerant mainly used in vehicle air conditioning. According to the statistics from China Association of Automobile Manufacturers, the output and sales of automobile in April 2012 dropped by 12.39% and 11.65% respectively month on month.

It is estimated that the price of HFC-134a will keep falling in the next three months. Firstly, the supply of HFC-134a will increase, which may cause the price falling of HFC-134a. Zhejiang Juhua Co., Ltd. (Zhejiang Juhua) and Dongyue Group Ltd. (Dongyue Group) will launch new HFC-134a production lines in 2012. Nowadays, Dongyue Group's new production line of HFC-134a with 10,000t/a is in the process of commissioning and will be launched in July or Aug. 2012. Simultaneously, Zhejiang Juhua's new production line of HFC-134a with 30,000t/a will also be launched step by step. Secondly, the production cost of HFC-134a will remain lower. Since the oversupply of TCE will continuously intensify, the price of TCE in China will keep falling in the future. Simultaneously, affected by the fatigued market of downstream products, especially the fluoride refrigerants and fluoropolymers, the future price of AHF will also keep low in the next two months.

Source: China Fluoride Materials Monthly Report 1206

Main content of China Fluoride Materials Monthly Report 1206:
Chi Natural Inv purchases fluorite ore in Mongolia
Yongtai to exploit fluorite ore
Domestic price of HFC-134a to keep falling in the next three months
China provides financial subsidy for energy-efficient room air conditioners again
China launches the first stage of HCFC-141b elimination
The US new trade policies affect domestic electronic grade HF
China to break the global monopoly by Dupont in PVF film production
Domestic PTFE price decreases sharply in May
Domestic PVDF hollow fiber membrane to expand its application on urban sewage water treatment
Fujian Bote to construct production line of inhalation anesthetics
Morita Chemical to expand investment on lithium ion battery electrolyte in China
Import and Export analysis of fluoride chemicals in China in April 2012

China Fluoride Materials Monthly Report, a monthly publication issued by CCM International on 20th of every month, covers the sectors on policy & legislation, company dynamic, supply & demand, price update, etc. of China’s fluoride material market. It will help you follow the dynamic throughout the whole value chain immediately.

About CCM International
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