Introduction: The price of anhydrous hydrofluoric acid will decline in 2023 compared with 2022, and product profit levels will remain at a low level. Although both market demand and corporate supply increased during the year, as the growth rate of demand failed to exceed the growth rate of supply, oversupply in the market still existed and companies were still under pressure.
The overall price of anhydrous hydrofluoric acid in 2023 is lower than that in 2022, with the average price during the year falling by 9.45% year-on-year. Although demand in the downstream industry increased during the year, new production capacity on the supply side continued to be released, and its growth rate exceeded the demand growth rate, resulting in increasingly fierce competition among enterprises and falling prices.
New production capacity continues to be released, and industry production capacity increases.
In 2023, the production capacity of the anhydrous hydrofluoric acid industry will continue to increase. The effective production capacity during the year was 3.276 million tons, and the production capacity growth rate was 11.58%. In recent years, the profits of the fluorine chemical industry chain have gradually been transmitted downwards. In addition to downstream demand-driven production capacity expansion, some companies have equipped raw material production lines to increase overall profits, reduce production costs, and ensure stable supply of raw materials. This makes the advantages of leading companies more obvious. This trend has also made the advantages of industry leading companies more and more obvious, downstream companies have more say, and the competitive pressure of single-type production companies remains.
During the year, the total output of the anhydrous hydrofluoric acid industry reached 1.9867 million tons, a year-on-year increase of 9.50%. Especially after September, with the continuous commissioning of new production capacity, the monthly output gradually climbed to more than 170,000 tons, and the market supply was abundant. In terms of price, prices also fell back against the background of the continued increase in anhydrous hydrofluoric acid production in the fourth quarter.
Driven by the lithium battery and photovoltaic industries, demand continues to grow.
Domestic anhydrous hydrofluoric acid consumption is also showing a growth trend, with demand reaching 1.7159 million tons in 2023, an increase of 184,900 tons compared with 2022, and a year-on-year increase of 12.08%. In recent years, with the development of lithium battery, chip and other industries, the consumption of anhydrous hydrofluoric acid as a raw material for downstream processed products such as lithium hexafluorophosphate, PVDF and electronic grade hydrofluoric acid has continued to grow. According to data from Zhuochuang Information, the consumption of anhydrous hydrofluoric acid by electronic-grade hydrofluoric acid, lithium hexafluorophosphate, PVDF and other industries will reach 31.28% in 2023, an increase of 10.94 percentage points from 2022. The consumption of hydrofluoric acid in the fluoroalkane field is relatively stable. Although the downstream demand for anhydrous hydrofluoric acid is growing, its supply growth is still faster than the demand growth. Enterprises mainly maintain the balance of market supply and demand by adjusting operating hours. During the year, the operating rate of the anhydrous hydrofluoric acid industry remained at 60.64%, down 1.16 percentage points year-on-year. The market supply and demand situation was relatively tight.
Competition among enterprises is still going on in the market outlook.
It is expected that the supply growth rate will be higher than the demand growth rate in 2024, and the oversupply situation will still exist. It is expected that low-price competition among enterprises will be obvious, and it is difficult for product profit margins to perform well. From the perspective of raw materials, the supply situation in the fluorspar market is expected to be improved in 2024 compared with 2023. The tight supply situation in the market may be alleviated to a certain extent. The price of fluorite powder is expected to fall, which will support the price of anhydrous hydrofluoric acid. weakened, prices are also expected to fall.