Fluorspar: 2014 Review

By Andrew Miller
Published: Wednesday, 31 December 2014

A tough year for fluorspar producers sees acidspar prices fall 13% as metspar market stagnates.

Fluorspar: 2014 Review

A tough year for fluorspar producers sees acidspar prices fall 13% as metspar market stagnates

Andrew Miller

Weak demand conditions and strong price competition dragged the fluorspar market to four-year lows during 2014, with prices falling by up to 24% over the year.

In the acidspar market, the threat of potential new capacities compounded the slump in consumption rates at the start of the year.

Low offers from the Chinese market soon dragged prices to new lows in Q2 2014, however, as producers sought to reduce stockpiles. Structural adjustments in downstream markets failed to aid these efforts, with producers across the world reducing output in an attempt to ease the growing supply chain backlog. 

While India’s fledgling fluorochemical sector proved an exception to this – as one of the only countries to exhibit demand growth throughout the year – the market was unable to absorb growing inventories. 

Disappointing growth in industrial end-markets also failed to provide any positive momentum in the market in 2014. With steel output growth slowing to around 2%, metspar suppliers in particular continued to feel the effects of the laboured recovery in industrial demand.

As prices slumped under the weight of weak demand, a divergence emerged among producers as some focused on competing on price, while others sought to achieve quality improvements.

These adjustments in output are estimated to have caused global output to fall by 1.7% year-on-year, for the third consecutive year. Despite this, however, a new generation of producers continued to develop projects outside of China. 

Two mines came into production in Germany and Afghanistan in Q3 2014, threatening to increase excess supplies approaching the end of the year. 

These pressures were alleviated to some extent by the announcement of the closure of Solvay’s Okorusu mine in Namibia, where ongoing low prices made production uneconomical. 

Despite this closure taking around 80,000 tpa fluorspar capacity offstream, the development of major new mines in Vietnam, Mongolia and Canada are at risk of increasing global capacities moving into 2015. 

These new sources of production are at risk of causing further price decreases moving into the new year.

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• Graphite prices from Africa, Austria, China, Europe, India and Sri Lanka

• 36 active prices, seven historical

• Full access to data from 1988 onwards

• Fluorspar prices from China, Netherlands, India, Mexico, Mongolia, South Africa, the UK and the US

• 20 active prices, seven historical

• Full access to data from 1988 onwards

Stat of the month

100,000 tonnes

the target output from the Bakhud fluorspar reserve in Afghanistan in 2015.

Mongolia’s fluorspar deposits 
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LONDON, UK

Andy Miller, Analyst

amiller@indmin.com

Shruti Salwan, Analyst 

ssalwan@indmin.com

SHANGHAI, CHINA

Albert Li, Analyst

ali@indmin.com