In early July, mainstream refrigerant prices in China continued to hit new decade‑highs.
As of July 3, 2026:
- R32 (the mainstay for household air conditioners) was quoted at RMB 64,000/ton, a surge of more than 320% from RMB 15,000/ton in early 2024.
- R134a (commonly used in automotive and cold‑chain applications) also reached RMB 64,000/ton, up over 30% year‑on‑year.
- R22 has risen cumulatively by 28% so far this year.
Quota System Caps Supply
In accordance with China’s compliance obligations under the Montreal Protocol and the Kigali Amendment, the country officially implemented production quota management for third‑generation refrigerants (HFCs) starting in 2024.
From 2024 to 2026, the national HFC production quotas stand at 748,500 tons, 791,900 tons, and 797,800 tons respectively, leaving very limited room for additional supply.
At the same time, production quotas for second‑generation refrigerant R22 continue to be compressed, with the 2026 quota reduced by nearly 3,000 tons compared to the previous year.
Given the high concentration of China’s refrigerant industry—the top six players (CR6) account for nearly 90% of the market—leading producers hold the vast majority of production quotas. This makes uncontrolled capacity expansion and price wars highly unlikely, and supply stability has clearly improved.
According to the compliance schedule published by China’s Ministry of Ecology and Environment, controlled‑use HFCs will enter the next phase of reduction in 2029, meaning supply will remain constrained for the next several years.
In addition, several producers are planning routine maintenance shutdowns in the third quarter, which is expected to further tighten short‑term market supply.
U.S. and U.K. “Delay Phase‑Out” Unexpectedly Extends Overseas Demand
In May this year, the United Kingdom announced a postponement of its next‑round F‑gas reduction plan, originally scheduled for 2027. Shortly thereafter, the United States adjusted certain regulatory policies in the refrigeration and air‑conditioning sectors, extending compliance use periods for some HFC products.
While neither policy changes the long‑term direction of emissions reduction, they do mean that third‑generation refrigerants will remain in use longer in European and American markets. Since both the U.K. and the U.S. are heavily reliant on imports, local market prices quickly jumped after the policy announcements:
- Beijer Ref UK, a British refrigeration equipment distributor, announced price hikes effective May 20: R410A and R407C up 60%, R134a up 35%, and R32 up 30%.
Following the overseas price increases, Chinese exporters also raised their offer prices, and the domestic R22 price jumped by more than RMB 2,000/ton in a single week.
The sustained overseas demand helps domestic manufacturers maintain strong export order books and also buys more time for the gradual scale‑up of fourth‑generation refrigerants.
Industry Leaders Report Strong Earnings – Juhua, Sanmei, and Yonghe All Deliver Good News
Juhua Co., Ltd.
In the first quarter, the company achieved operating revenue of RMB 6.018 billion and net profit attributable to shareholders of RMB 1.173 billion, an increase of approximately 46% year‑on‑year. Its refrigerant business alone generated revenue of RMB 3.142 billion, accounting for more than half of total revenue, with average product prices rising to RMB 44,523/ton.
Meanwhile, Juhua’s plant in the UAE resumed production in June. The company now has existing and planned fourth‑generation refrigerant capacity totaling 45,000 tons, positioning itself early for the next product upgrade cycle.
Sanmei Chemical Co., Ltd.
First‑quarter net profit attributable to shareholders reached RMB 506 million, up 26% year‑on‑year. The average selling price of its fluorinated refrigerants rose from approximately RMB 40,000/ton in 2025 to about RMB 46,500/ton.
Yonghe Chemical Co., Ltd.
In its semi‑annual performance forecast, the company expects net profit attributable to shareholders of RMB 460–550 million for the first half of the year, representing year‑on‑year growth of 69.51% to 102.68%. The company attributed the profit surge mainly to refrigerant prices maintaining high levels under the quota management system.
Outlook for the Second Half of 2026
The price‑increase expectations for refrigerants remain solid. The national production quota of 797,800 tons has been set, and new supply is limited. Hot summer weather is driving air‑conditioner maintenance and restocking demand, while overseas orders remain robust. Long‑term contract prices for the third quarter are still likely to see further upward adjustments.
