Price trend

In October, the domestic fluorite price trend declined. By the end of the month, the average domestic fluorite price was 3,537.5 RMB/ton, a decrease of 2.01% from the beginning of the month (3,610 RMB/ton), and an increase of 0.71% year-on-year. 

Supply side: Mine operation was low and fluorite spot prices were normal

The domestic fluorite industry remained in a state of flux, with overall enterprise operating rates showing little change. Upstream mining remained tight, outdated mines would continue to be phased out, and mineral surveys for new mines continued to face significant challenges. Furthermore, government departments were implementing rectification measures for fluorite mines, leading to increasingly stringent safety and environmental requirements, making it more difficult to operate. The shortage of raw materials had limited fluorite production, with some mines in the south operating at low capacity. While the market was experiencing tight supply, the "buy high, sell low" mentality had dampened purchasing interest, resulting in a decline in fluorite prices. As temperatures dropped in the north, the winter shutdown period for mines and processing plants in the region was approaching, further tightening market supply. Meanwhile, demand remained weak, leading to continued competition between supply and demand, causing the fluorite market to retreat from its high levels.

Demand side: Hydrofluoric acid prices declined, refrigerant market was favorable

Domestic hydrofluoric acid prices declined in October, with mainstream negotiated prices in various regions ranging from 12,000 to 12,500 RMB/ton. Downstream hydrofluoric acid plants remained shut down, resulting in little change in spot supply. Manufacturers primarily purchased hydrofluoric acid on an as-needed basis, maintaining an overall operating rate of just over 50%. Hydrogen fluoride companies maintained only their immediate order needs, while hydrofluoric acid companies were operating at a loss. Recently, hydrofluoric acid traders were reluctant to purchase, leading to a fierce struggle between supply and demand in the fluorite market, resulting in a "high price but no market" stalemate. Lacking strong demand support, fluorite market prices had corrected.

The downstream refrigerant market was performing reasonably well. With supportive policies from the refrigerant industry's end-user sector, demand was expected to see a substantial increase. Fluorochemical companies within quota controls have strong confidence in maintaining refrigerant prices. While current high prices have led to a slower pace of procurement, industry inventory levels are being managed in a healthy and orderly manner, with upstream product procurement primarily based on immediate needs. Refrigerant prices had risen somewhat, but companies remained cautious about upstream procurement. Hydrofluoric acid companies were also cautious in their purchases, and fluorite market prices were declining.

In addition to the traditional demand from the refrigerant industry, fluorite, as an important mineral raw material for modern industry, is also being used in strategic emerging industries such as new energy and new materials, as well as in defense and nuclear industries. These applications include lithium hexafluorophosphate, PVDF, graphite anodes, and photovoltaic panels. Driven by demand from new energy and semiconductor industries, the application of fluorite has received some support.

Market outlook

The supply of fluorite in China was difficult to improve recently, with some mines suspending production for safety inspections. The tight supply of fluorite was a positive support for the fluorite market. In addition, the supply of fluorite in the north will become tighter in the future. However, downstream hydrofluoric acid companies mainly purchased on demand, and demand had not actually improved. There was a fierce interplay between supply and demand. Overall, the fluorite market price is expected to fluctuate in the short term.

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