a lot of neatly arranged refrigerant tanks

Figure 1: Refrigerant tanks.

Refrigerant is a compound that usually exists in a liquid or gaseous state. It easily absorbs heat from the environment, and when combined with other components such as compressors and evaporators, it can provide refrigeration.

1. R125 Refrigerant Price Increase Analysis (China Market)

Recently, the overall price of refrigerants in China has risen, with the rising price of R125 being particularly prominent.

R125 refrigerant (pentafluoroethane) is a kind of HFC refrigerant, which does not damage the ozone layer of the atmosphere. R125 is an important material for making R404A, R407C, R410A, R417A, and R507. R410a, made from R32 and R125, is a new type of refrigerant, which is currently being used in various air conditioners. R125 can be used to replace R502 and R22, and can also be used as a kind of extinguishing agent to replace Halon 1211 and Halon 1301.

1.1 Growth Rate of R125 Price

According to the data released by the leading appliance refrigeration industry information service provider in China, recently, the prices of various refrigerants have maintained a rapid rise. Please see the table below for details.


Price (yuan/tonne)

Increase percentage(%)



From 33,000 to 50,000



From 100,000 to 140,000


R22, R134a



Table 1: The price increase of refrigerants in the last two weeks.

The rapid increase in the overall price of refrigerants this time is driven by R125. Its price has increased by close to 80% within a month, setting a new high in the past three years.

Starting from the beginning of 2021, the R125 market had got rid of the loss-making situation, and the overall price stability was improved. Due to the slight easing of the raw material supply tension, the follow-up price of R125 began to fall steadily from 38,000 yuan/tonne. However, it bottomed out at 27,800 yuan/tonne at the end of July and rebounded to 50,000 yuan/tonne in mid-August. In the last two weeks, the R125 price increase was more than half.

a line chart of the weekly average price trend of refrigerant R125 from January to August 2021 and the price trend is rising

Figure 2: The weekly average price trend of refrigerant R125 (yuan/tonne).

1.2 Reasons Behind the Soaring Price of R125

There are two main influencing factors: the shortage of raw materials and the US antidumping ruling.

The shortage of raw materials

The price of R125 is affected by both raw materials and supply and demand. In a weak market environment, the price of R125 is greatly affected by the raw materials. The raw material tetrachloroethylene imports account for a relatively high proportion of orders and purchases, so its supply volatility is also relatively large. Looking at the price curve of R125 and that of PCE as its raw material, the trends of the two are highly convergent.

Recently, the raw material PCE has been affected by the dual effects of poor cargo arrival at the port and low-load start-ups caused by the overhaul of factories in China. As the output of PCE shrinks, the price has risen, causing the cost of R125 to rise sharply.

comparison of the weekly average price trends of PCE and R125 from 2020 to now and the polyline changes of the two are highly convergent

Figure 3: Comparison of the weekly average price trends of PCE (yuan/tonne).

From the perspective of supply and demand, on the supply side, most of the R125 factories in the early stage were overhauled. In addition, due to the low production enthusiasm of the price inversion, the product inventory is low. Due to the shortage of raw materials, the factory load is not high, resulting in more heavily insufficient supply in the R125 market. On the demand side, it has been affected by factors such as increased exports. Therefore, the R125 market is clearly in short supply and the gap is large.

However, the reason for the price increase of R125 is far more than that. The impact of the US anti-dumping ruling on R125 imported from China cannot be ignored.

U.S. anti-dumping ruling

On August 11, the US Department of Commerce announced a preliminary ruling that the R125 dumping rate of Chinese manufacturers/exporters was 280.37% to 280.48%, and it will make a final ruling on December 30. Based on the price trend of R125 and policy published about it, in the past two years, except for the large increase in R125 in November 2020 because of the shortage of raw material PCE, the other large increases are basically closely related to the United States' sanctions on Chinese-made R125.

Therefore, there are enough reasons to believe that in order to avoid higher prices after the anti-dumping policy is formally implemented, refrigerant companies choose to stock up in large quantities, which is also one of the main thrusts for the price increase of R125.

from 2020 to the present, the US anti-dumping rulings and R125 weekly average price trend nodes diagram, and it reflecting the great influence on R125 price rising caused by the rulings

Figure 4: The impact of U.S. sanctions on the price of R125 (yuan/tonne).

1.3 Rising Refrigerant Prices Not to Change in a Short Term

In view of the fact that the price of raw materials is bullish and the supply and demand tensions are difficult to reverse in the short term, the upward trend of refrigerant price will not change in the short term.

The first is that the prices of raw materials such as anhydrous hydrofluoric acid (AHF) and calcium carbide will continue to rise in the near future. At the same time, with the arrival of China's domestic stocking period and the continued high demand for foreign trade, coupled with the sharp increase in the price of R125, the industry as a whole is optimistic about the refrigerant market. Overall, the refrigerant price increase trend is obvious.

Under the influence of multiple factors, China's domestic refrigerant industry may usher in a small peak of development. China's HFCs refrigerant volume is huge, and the production, consumption and export volume rank first in the world. Under the combined effects of poor raw material supply, general rise in refrigerant prices, and the progress of the "Kigali Amendment" process, people inside and outside the industry generally have an optimistic outlook on the later refrigerant market.

Affected Industries

a girl standing at the front of an open fridge to check out the foods

Figure 5: A girl standing at the front of an open refrigerator.

The increase in the price of R125 will affect related industries. For example, since R125 is one of the two-component refrigerants of R410a (the other is R32), any shortage of it will significantly affect the output and price of R410a.

Rising refrigerant prices will affect manufacturers of household air conditioners, car air conditioners, freezers and refrigerators. The percentage of refrigerant applications in the home appliance industry is as follows: air conditioners accounting for 78%, refrigerators 16%, and automobiles 6%.

According to China's national statistics, from January to July this year, the cumulative year-over-year growth rate of the output of air conditioners and refrigerators respectively reached 17.3% and 11.3%, both maintaining double-digit growth. And the year-over-year growth rate of automobile production increased by 17.2%. These have greatly increased the demand for refrigerants.

Refrigerant Prices in the International Market

this graph representing the price rising consists of arrows and rectangle

Figure 6: Graph representing an upward trend.

The above is an analysis about the reasons and effects of the R125 price increase in the Chinese market. From the perspective of the international market, the price of refrigerants is also on the rise due to many factors. The following are some reasons.

The rising price of steel directly leads to the cost of the steel cylinder that used to contain the refrigerant.
Affected by COVID-19, the major refrigerant manufacturers Honeywell, Chemours and Arkema have also slowed down or stopped the production of refrigerants. Therefore, the supply chain is working hard to resume production.
The increase in fuel and labor costs directly leads to manufacturing and transportation costs, and ultimately to price increases.
The cost of transporting goods between countries increases, and dozens of industries scramble for the limited supply of goods, which led to a sharp increase in the price of inputs required by production.

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