The global fluorspar industry has been in the doldrums for
around three years, as declining prices and falling demand for
fluorochemicals used in refrigerants and steel manufacturing
has led to significant price erosion.
Regional deterioration in demand has forced the closure of
some projects, notably in Africa, while some fluorspar
exploration companies have moved away from the sector.
Changing environmental regulations are likely to put
pressure on producers of fluorochemicals and while overall
demand for fluorspar will probably be held up by its inclusion
in reformulated, more environmentally alternative products, the
transition period is expected to be an uncertain time for
The year started with what appeared to be a liberalisation
of fluorspar supply, as China removed export limits on
fluorspar along with 47 other minerals in January as part of
the Ministry of Commerce’s (MOFCOM) statement on
quota licencing, bidding and licence management. The move
followed a March 2014 ruling by the World Trade Organization
(WTO) that Chinese quotas contravened international trade
rules. In the same month, in Germany, reports that
locally-based metallurgy company Nickelhuette was escalating
output at its new site in the Ore Mountains indicated that
German fluorspar production would reach over 25,000 tonnes in
2015, 80% of which would be acid-grade material (acidspar),
boosting the country’s self-sufficiency.
Rising European production was expected to compensate for
the closure of Solvay SA’s Okorusu fluorspar mine
in Namibia at the end of 2014, although in the event, low-cost
material sourced from Asian suppliers was widely available in
In May, Kenya Fluorspar Co. Ltd wrangled with the Kenyan
government over allegations of unpaid taxes. The company, which
has a production capacity of 100,000-120,000 tpa fluorspar,
sold mainly into the fluorochemicals market, nevertheless
maintained operations over the course of the year.
In June UK-listed fluorspar junior Tertiary Minerals doubled
the indicated and inferred mineral resource estimate for its MB
project in Nevada to 86.4m tonnes, grading at 10.7%
CaF2. The company commenced drilling at the site in
IM held its annual fluorspar conference in
Marrakech, Morocco, in October, where delegates discussed
falling Chinese acidspar exports and increased domestic
consumption – a situation that looks likely to erode
the country’s position as the dominant global
supplier. This trend was seized on as an opportunity by
emerging players from Vietnam, Thailand and Myanmar.
The industry has recently seen some strong new players
entering the market, with Vietnam-based Masan Resources
emerging as a major supplier.
Supply from Southeast Asia is expected to make up, to some
extent, for the closure of the Witkop and Buffalo fluorspar
mines in South Africa, which face being shut down owing to poor
demand and relatively high cost.
While many were optimistic of a minor uptick in consumption
from industrial sectors – particularly the aluminium
fluoride (AlF3) market – towards the end of
2014, 2015 began with few signs of a rebound in demand.
Figures for 2014 released towards the end of Q1 2015
indicated a resurgence in US metallurgical-grade fluorspar
(metspar) consumption. Metspar export volumes from Mexico
increased by 21% year-over-year (y-o-y) to 350,472 tonnes in
2014, largely benefitting from the recovering steel market in
the US and boosting sales for locally-based market leader,
Mexichem SA de CV.
Elsewhere, rising cement demand in Asia was also expected to
support the metspar market. China’s fluorspar
export figures for 2014, meanwhile, showed positive growth in
downstream markets with exports for both hydrofluoric acid (HF)
and AlF3 rising, while acidspar figures registered
The most significant question mark hanging over the
fluorspar industry in 2015 was probably the ambiguity over the
phasing out of hydrofluorocabons (HFCs) in refrigeration and
other industries, with the aim of replacing them with less
environmentally damaging hydrofluoroolefins (HFOs). In
mid-2015, the US government announced private sector
commitments to cut the use of HFCs and began pushing other
nations such as India to follow suit. However, the approaches
of Article 5 (developing) and Non-Article 5 (developed)
countries (as defined by the Montreal Protocol) towards phasing
out HFCs differ in phase out targets and timelines, meaning it
is unclear at what rate the chemicals will be abandoned.
In December, governments and industries met in Paris at the
COP (Conference of Parties) 21 where the UN’s
Climate and Clean Air Coalition (CCAC) agreed an action plan to
reduce global emissions of short-lived pollutants, including
HFCs. This incorporated a pledge under the Global Refrigerant
Management Initiative to reduce HFCs from refrigerant servicing
by 30-50% within 10 years.
Consumption rates of HF acid, the principal feedstock for
fluorochemicals and fluoropolymers, stand to be most affected
by this initiative in the short term.
In terms of consumption, Germany remains one of the largest
global markets for fluorspar behind China and the US, despite
German fluorspar consumption falling to around 200,000 tpa from
a previous peak of more than 300,000 tpa. In Asia, meanwhile,
rising affluence has seen an increase in demand for
refrigerating products and air conditioning – a trend
that is expected to continue in the medium term.
2015 also saw India, a major importer of fluorspar, begin to
switch its sourcing preferences from China to Southeast Asian
suppliers like Vietnam.
Fluorspar prices resisted fresh price pressures at the
beginning of the year, however excess supplies were already
threatening to force decreases as 2015 wore on. In the acidspar
market, inventories which had accumulated over the previous two
years were compounded by weak demand growth.
Prices for acidspar fell in consecutive months throughout
much of the year, while metspar prices fell at a more gradual
Attendees at the Marrakech conference told
IM that it is hard for operations with high
production and/or logistics costs to survive in the current
climate, especially when better quality acidspar material is
available at market-bottom prices of $230-$250/tonne.
The future looks challenging for the fluorspar market, with
the balance tilting firmly in favour of low-cost Asian
suppliers, whose competitive prices combined with the
discounted freight rates currently on offer could enable them
to penetrate wider geographies and threaten more expensive
operations in Africa, Europe and the Americas.
India is likely to register an average increase of 6% per
annum in its consumption of R22 – an important
fluorspar-based refrigerant for the air conditioning market
– from 2016. However, India’s overall
fluorspar consumption could decline by 20% next year, mainly
because of reduced demand from the steel industry.
China continues to develop its downstream fluorochemicals
business, taking some supply out of the global market. This
could simply result in local overcapacity moving downstream and
may do little to help demand.