Global Fluorochemical Demand Expected to Rise

Global demand growth for fluorochemicals is forecast to accelerate, rising 3.8 percent per year to 3.8 million metric tons in 2018. Above average growth in higher value products will help drive increases in value demand more than seven percent annually to $25 billion.  Environmental regulations will continue to be the strongest force acting on the industry, shaping demand in both positive and negative ways. 

While regulations and consumer concerns have reduced demand for some fluorine-based products, particularly ozone-depleting fluorocarbons, they have also opened up opportunities for products such as newer fluorocarbons with low global warming potential.  China is the largest fluorochemical market in the world and produces over half of global output, benefitting from its strong position in the raw material fluorspar. While fluoropolymers are the smallest product in volume terms, they account for a disproportionate share of market value due to their higher average prices.   These and other trends are presented in World Fluorochemicals, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm.

“The fluorocarbons market remains the most dynamic sector of the fluorochemical industry for two reasons: first, the evolving regulations aimed at protecting the ozone layer and reducing global warming, and, second, a sharp contrast in the outlook between developed and developing countries,” said analyst Ryan Sullivan. 

In developed countries, the phaseout of HCFCs is nearly complete, with most end users switching to HFCs. However, even HFCs now face restrictions due to their global warming potential (GWP), with new laws in developed countries expected to limit future demand. 

China will continue to be the largest and one of the fastest growing markets for fluorochemicals, accounting for over 40 percent of global volume demand in 2018.  Only India will experience faster growth, although from a much smaller base.  Developing countries in general are expected to see faster growth in fluorochemical demand as healthy economic growth drives rising commercial and household refrigeration penetration rates and countries increasingly adopt more advanced manufacturing technologies that employ fluoropolymers.  Demand growth in North America will rebound due to healthy advances in the automotive industry and an improving housing market in the United States.