What regulatory and supply factors are shaping the Chinese market for dichlorotrifluoroethane?

What regulatory and supply factors are shaping the Chinese market for dichlorotrifluoroethane?
China's market for dichlorotrifluoroethane (R123) is governed by the national HCFC phase-out management plan, aligned with the Montreal Protocol. Production quotas are allocated annually, and the baseline has been progressively reduced, with a complete freeze on new capacity. This regulatory framework has created a two-tier market: quota-holding producers supply domestic chiller manufacturers and maintenance networks, while non-quota material circulates in smaller volumes, often at higher prices. Downstream demand is anchored by the installed base of centrifugal chillers in commercial buildings and industrial facilities, which require R123 for servicing. Export demand, particularly to developing countries still transitioning from R-11, provides an additional outlet. Import data show periodic shipments from overseas producers, but domestic output dominates. Price movements correlate with quota availability, raw material costs for fluorochemical intermediates, and seasonal air-conditioning maintenance cycles.