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With soaring raw materials, where does the fluorocarbon coatings market go?

ECHEMI 2021-04-16

Since the second half of 2020, fluorine-containing raw materials have gradually come to the forefront. The market that has been relatively stable has also become popular with other chemical products. With the passage of time, it has become more and more intense. This article briefly tells you the ins and outs of this story.


1. The price of fluorine-containing raw materials soared
Fluorine-containing coatings, injection molded parts, lithium batteries, fluorine-containing photovoltaic backsheets, water treatment membranes, etc. all use PVDF fluororesin. Fluorine resins use fluorine-containing particles, and fluorine-containing particles use hydrochlorofluorocarbons (HCFCs). This is the source of the price increase.
In 1991, the Chinese government signed the "Montreal Protocol" and made a commitment to phase out the production and consumption of hydrochlorofluorocarbons (HCFCs). Since then, it has been vigorously advocating and implementing an orderly withdrawal plan to phase out HCFCs. According to the agreement, on the basis of production and consumption in 2013, China needs to phase out 35% of production and consumption in 2020 and phase out all production and consumption of hydrochlorofluorocarbons in 2030. This is also an important part of the Chinese government's commitment to carbon neutrality. Among the many varieties of hydrochlorofluorocarbons, R22, R141b, and R142b are three very important subdivided varieties. Among them, R22 is an important raw material for the fluoropolymer PTFE (polytetrafluoroethylene), and R142b is PVDF (polytetrafluoroethylene). Vinylidene fluoride) is an important source of raw materials.

Since the above three varieties are very important in the industrial field and cannot be completely withdrawn in the short term, the domestic policy implements quota production for the hydrochlorofluorocarbon raw materials used in the above three varieties, and the production and construction, scale, product destination and use, etc. Subject to strict national supervision, once the relationship between supply and demand changes, it is easy to cause tight supply of raw materials in the market.
The commitment to phase out 35% in 2020 will make the end of 2020 the first turning point for the implementation of the policy, and it is also a window period for the price changes of various types of hydrochlorofluorocarbons. According to the survey, the ex-factory price of R142b has risen from 15,500 yuan/ton in October 2020 to the current 38,000 yuan/ton, an increase of 145%! And it is impossible to estimate what price it will rise to in the future!


In the past three months, the price of R142b has exceeded the historical high of 30,000 yuan/ton, reaching 38,000 yuan/ton, and some foreign trade orders have even reached 42,000 yuan/ton. This is due to the commitment to eliminate 35% in 2020. The result of the extremely tight supply-demand relationship of R142b.


2. The price of fluororesin has risen
While the extremely tight supply-demand relationship of hydrochlorofluorocarbons has caused prices to rise, it has also driven the prices of its downstream products, fluororesins, to rise. For example, PVDF resin produced by R142b.


According to the current production level of PVDF resin, the unit consumption ratio of PVDF resin produced from R142b is about 1.9-2.0, that is, about 1.9-2.0 parts of R142b can synthesize 1 part of PVDF resin. Therefore, the price of R142b is in the cost of PVDF resin. The proportion is very important.
Therefore, the price surge of R142b material since October 2020 will inevitably be passed on to the price of PVDF resin in various application fields in the middle reaches. At present, the overall price of PVDF resin has increased by more than 40% compared with October last year!


3. Downstream demand intensifies the price increase of fluororesin
Fluorine resin has a wide range of uses. Taking PVDF resin as an example, the upstream raw material is R142b, and the downstream applications include fluorocarbon weather-resistant coatings, photovoltaic backsheet films, lithium batteries, oil pipes, chemical anti-corrosion parts, water treatment membranes, etc., as shown in Figure 3 above. In the downstream applications of PVDF resin, weather-resistant coatings account for the largest proportion, followed by injection molding and lithium batteries. The proportion of PVDF resin used in photovoltaic backsheets is not large.


It is important to point out that among the several major uses of PVDF resin, the proportion of the lithium battery market has increased significantly from less than 10% two years ago to 19.90%, and with the huge development of new energy vehicles, the proportion will increase The bigger it is, it will soon rank first among all major uses! This is because in the past two years, the world has been vigorously encouraging the development of new energy vehicles, and PVDF resin has been proven to be one of the indispensable key materials in power vehicle batteries and 3C electronics batteries.

Take my country as an example. According to the National Fourteenth Five-Year Development Plan, the development speed of new energy vehicles will increase fourfold by 2025! The demand for PVDF resin is as high as more than 50,000 tons! At present, the total production capacity of all domestic PVDF resin manufacturers is not 50,000 tons! Due to the rapid development of global new energy vehicles, the use of lithium batteries for PVDF resin has increased sharply. Global lithium battery giants CATL, BYD, Panasonic, LG, etc. have seized PVDF resin production capacity globally, resulting in a tight supply of PVDF resin in all industries , And the expansion cycle of PVDF resin is about 3 years, seriously lagging behind the growth rate of demand for lithium batteries.

In addition, due to the extremely high requirements for safety and stability in the automotive field, the battery field has a high price tolerance for PVDF resin, which causes the price of PVDF resin for batteries to be much higher than those in the fields of photovoltaics, coatings, and chemical anti-corrosion parts. product price. Under the above background, PVDF resin manufacturers have adjusted their existing production capacity to the lithium battery field as much as possible, which has caused a serious shortage of existing PVDF resin in other fields.


4. The quantity of fluororesin is in short supply and the price is high. Where will the price and supply of fluorocarbon coatings go?

With the skyrocketing price of fluororesin, all companies producing PVDF coatings are facing huge cost pressure and the problem of shortage of fluororesin supply. The larger the amount of the original enterprise, the greater the pressure, the greater the determination of the price to be transmitted to the downstream! Downstream customers must be prepared for price increases or even shortages, because all companies will give priority to ensuring their strategic customers when encountering such difficulties. Perhaps in the near future, downstream companies using fluorocarbon coatings will appear to grab stocks. Therefore, everyone should get ready for psychological and resource allocation!

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