This week, the domestic fluorite price trend has slightly declined. As of the weekend, the average domestic fluorite price was 3396.25 yuan/ton, a decrease of 0.66% from the beginning of the week price of 3418.75 yuan/ton and a year-on-year decrease of 0.48%.
Supply side: Double pressure formed by accelerated resumption of production and increased import volume
1. Domestic mines and beneficiation plants accelerate resumption of work and production
With the warming of temperatures in northern production areas, the operating load of core production areas is gradually increasing. The safety and environmental protection inspections in major production areas such as Zhejiang and Inner Mongolia have slowed down, and the operating rate has increased, directly increasing the supply of spot goods. Although some resumption of work was delayed in the first quarter due to stricter safety supervision, it has basically returned to normal by mid to late April. In addition, the newly discovered fluorite mines in Sichuan, Gansu and other places have further strengthened the expectation of loose supply in the medium and long term. As a result, the domestic fluorite spot supply is sufficient, and the fluorite market has slightly declined.
2. Normalization of industry regulation makes it difficult to add new mines
As a national strategic scarce mineral, fluorite has been continuously upgraded in safety and environmental control in recent years, with increased efforts to control the total amount of mining and accelerated elimination of backward small and medium-sized mines, leading to a continuous increase in industry concentration. The approval process for new mines is strict, and mineral exploration is difficult. The effective production capacity growth of domestic fluorite is weak, and high-grade raw ore is becoming increasingly scarce. At the same time, the normalization of mining rectification and production restrictions measures has further compressed the market circulation of goods and suppressed the decline of fluorite raw materials.
3. The import source continues to increase in volume, and the price advantage is significant
The domestic dependence on foreign fluorite has exceeded 30%. After the end of the rainy season in Mongolia, the arrival volume in April and May increased significantly by about 40% month on month, and the import price was about 300-500 yuan/ton lower than that of domestic products. In addition, low arsenic fluorite (≤ 0.0005%) enjoys a zero tariff policy, effectively reducing import costs. The concentrated arrival of Mongolian fluorite at ports in East and North China has had a sustained suppressive effect on domestic market prices.
Demand side: Low core downstream operating rate, difficult to boost prices due to rigid demand
1. The hydrofluoric acid industry is suffering serious losses, and procurement is passively shrinking
The operating rate of hydrofluoric acid enterprises is only about 50%, and most of them suffer serious losses. They mainly purchase for essential needs and have a strong willingness to lower the price of upstream fluorite, basically maintaining only essential needs procurement. In addition, the mainstream contract price in June fell to 14500-15000 yuan/ton, but the demand follow-up was clearly insufficient, and there were signs of capacity utilization shrinking, resulting in a slight decline in the domestic fluorite price trend.
2. The refrigerant operating rate is difficult to exceed 50% due to quota restrictions
Affected by the refrigerant quota system and the relatively flat demand in the home appliance market, the operating rate of core refrigerants such as R22 and R32 is difficult to exceed 50%, which indirectly weakens the demand support for fluorite. Downstream hydrogen fluoride enterprises tend to be cautious in their procurement, adopting a strategy of on-demand replenishment and batch replenishment, only making phased purchases, and suppressing the domestic fluorite market price.
Market forecast: Due to the warming weather in northern production areas and the accelerated resumption of mining production, some manufacturers in the domestic fluorite market have high inventory; The trend is that the operating rate of downstream fluorine chemical industry has not changed much, and downstream continues to observe, buying up instead of buying down to strengthen the downward trend. It is expected that the price of fluorite may slightly decrease, but the cost inversion is obvious, and the decline of fluorite is limited.
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