Introduction
Mid-May has arrived, and the fluorspar market continues its weak consolidation trend. Industry participants are puzzled: downstream operating rates have rebounded significantly, and downstream pricing has risen for months, yet the driving effect on fluorspar remains sporadic. Under the influence of prior factors, the fluorspar market has experienced underlying imbalances, later cushioned by safety thresholds, making it difficult to be boosted by downstream positive signals.

Early Policy Adjustments Triggered Safety Alerts on the Demand Side; Long-Term Inventory Accumulation Smoothed Market Fluctuations

Domestic policies have tightened step by step. China has imposed strong constraints on the fluorspar market through tax, safety, and environmental policies. Since fluorspar was classified as a strategic mineral in 2016, the total mining volume cap has been set at 5.3 million tons. Approvals for new mining rights have nearly ceased, and small and medium-sized mines have accelerated their exit. The policy that had a substantial impact on the fluorspar market was the nationwide safety special rectification for fluorspar mines launched in March 2024. At that time, major production areas such as Inner Mongolia, Zhejiang, Jiangxi, and Fujian saw large-scale suspensions or production cuts. Coinciding with the post-Lunar New Year resumption period, the recovery pace was essentially halted. Domestic capacity contracted rapidly, operating rates were extremely low, and market expectations of a mineral shortage intensified.

On the demand side, not only end-users but also trading companies found it difficult to source supply. End-users, fearing supply disruptions that would impact production plans, hoarded inventory ahead of time. The market atmosphere ignited quickly, and prices soared from 3,000 RMB/ton to nearly 4,000 RMB/ton. This price surge was eventually balanced by imported supplies, which also deepened downstream end-users' awareness of maintaining inventory holdings. Many enterprises increased their procurement volumes in regular purchasing cycles, accumulating and maintaining high inventory levels over the long term. This enhanced downstream dominance while balancing the elasticity of fluorspar price movements.

Single-Demand Structure Vulnerable to External Shocks

Demand for fluorspar is highly concentrated in the hydrofluoric acid–refrigerant chain. Although emerging sectors such as new energy and electronics have added some impetus, the mainstream output remains centered on the fluorochemical industry. Within this chain, overcapacity in the hydrofluoric acid market prevents positive signals from being fully transmitted back to the raw material end even when downstream conditions improve. The fluorspar market mostly relies on market sentiment and the pricing drive from downstream anhydrous hydrofluoric acid.

However, due to international geopolitical instability, the sulfuric acid market has shifted from a "supporting role" to a "leading role," continuously doubling cost pressure on the anhydrous hydrofluoric acid end. Anhydrous hydrofluoric acid operating rates have declined as small and medium-sized enterprises suspended operations to avoid risks, reducing fluorspar consumption. Since the post-Lunar New Year period, anhydrous hydrofluoric acid pricing has risen by approximately 3,000 RMB/ton, reaching 15,000 RMB/ton. Meanwhile, after rising to 3,550 RMB/ton in April, the fluorspar market began to decline. The correlation between fluorspar and anhydrous hydrofluoric acid has weakened. In May, anhydrous hydrofluoric acid pricing provided producers with relatively substantial profit margins, prompting a significant increase in operating rates. Nevertheless, fluorspar remained resistant to this trend and continued to decline, mainly because sulfuric acid retained high prices, occupying the bulk of costs. Moreover, the demand side had inventory to consume, shifting its focus away from fluorspar and fostering a price-cutting sentiment.

Imported Supply Squeezes Domestic Share; Tight Supply-Demand Balance Points to Mismatch

The fluorspar market initially maintained a tight supply-demand balance. However, imported supplies shifted from "filling gaps" to "substituting," shrinking the domestic market share. This also highlighted the scarcity of high-quality supply. Imported cargoes are abundant in low-grade material, while traditional demand has contracted. New energy demand—a key breakthrough point for new carriers—translates into demand for high-quality fluorspar. Thus, although imported supplies offer a price advantage and put domestic resources at a disadvantage, high-grade and stable supplies remain favored by downstream end-users. There is a shortage of high-grade fluorspar and an overhang of low-grade inventory. While overall supply has been supplemented, it has moved toward a structural mismatch.