Chinese Acidspar Prices Expected to Dip at Year End Before 2016 Recovery

LONDON, September 30, 2015 /PRNewswire/ --

Acidspar prices heading for further falls 

Export prices for Chinese acid-grade fluorspar (acidspar) are expected to decline further towards the end of 2015 as weakness continues in some end-use markets, according to the latest Roskill analysis.

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Chinese acidspar export values averaged US$298/t FOB in H1 2015, falling from US$303/t in the previous six months and US$323/t FOB in H1 2014, according to Roskill's Fluorspar Industry Briefing. Prices have been affected by lower demand for hydrofluoric acid (HF), for which acidspar is the key feedstock material.

HF itself is used as a fluorine feedstock in a wide range of downstream fluorochemicals, including feedstock fluorocarbons for use in fluoropolymers, and non-feedstock fluorocarbons for fluorine refrigerants. It is in the non-feedstock fluorocarbons sector that demand has dropped off, partly because of tighter environmental legislation relating to emissions of fluorine gases with a high global warming potential.

Heading into early 2016, a slight uptick in Chinese acidspar export prices is forecast, although this is not likely to exceed levels seen in H1 2015. However, by H1 2017 a stronger price recovery is expected in tandem with increased acidspar demand, which is anticipated to come from the aluminium fluoride sector - the other key acidspar market.

Acidspar operating costs 

Chinese acidspar export prices are at their lowest point since June 2012, just prior to the price surge that saw levels of over US$440/t. However, similar price rallies are not expected before 2017 because they are not supported by acidspar demand.

Some industry commentators have predicted a price recovery on the basis that a number of acidspar miners may be selling acidspar at close to or below production cost - particularly in China where wages and energy costs have increased in recent years.

Cost analysis by Roskill, however, indicates that the top seven Chinese acidspar miners have continued to make a profit of nearly US$100/t, even at the current low prices. As a result, fluorspar prices are unlikely to increase because of producer costs - instead price rises are likely to occur when they are driven by higher demand.

These and other market trends will be discussed by Jessica Roberts, Senior Analyst at Roskill Information Services, at the Industrial Minerals Fluorspar conference in Marrakech, Morocco, 6-8 October 2015. Richard Pell, Sales Manager at Roskill, will also be attending. Please contact Jessica (jessica@roskill.co.uk) and Richard (richard@roskill.co.uk) for a meeting to discuss the fluorspar market and our services.    

SOURCE Roskill Information Services