Refrigerant Availability: CRITICAL!<
The
shortage of a key ingredient for HFC refrigerant blends may boost wholesale prices.
To me, one of the most important reasons for attending each year’s AHR Expo is having the opportunity to sit down with some of the people who really know what’s going on in our industry, in order to find out what issues facing us may be critical. While attending this year’s show in Las Vegas in January, and after speaking to Jay Kestenbaum, senior vice president of Airgas Refrigerants Inc., I was shocked!
The news he shared with me was nothing really new. However, what shocked me is that nobody seems to be worried about it, and few people appear to understand the problems that will be created for us! He pointed out that our industry is facing a critical shortage of one of the key ingredients for all our HFC refrigerant blends, R-125, and it looks like we are going to see a lack of availability of such products as R-410A and dramatically rising prices as this year progresses. In fact, he suggested that wholesale prices could go as high as $20 to $30 per pound by the end of the year, since no price increase will make the refrigerants more available!
The problem, as he explained it, is that the primary source of a key HFC ingredient (fluorine gas) - China - is in the midst of its greatest building boom ever, and everyone wants air conditioning. So their sales of A/C units suddenly jumped from 65 million to 98 million! As a result, the major share of R-125 is being used within their own country, leaving the rest of the world in a severe shortage condition.
This isn’t an artificial problem that’s being created to raise prices like the great “toilet paper shortage” of the early 1970s. The mineral fluorspar, from which we get fluorine gas, is only found in large quantities in China (though some is found in Mexico and some in Indiana ???), and their methods of extracting it are still a bit antiquated. So the Chinese aren’t geared up to handle the increased volume.
I double-checked this information with other refrigerant manufacturers and found that they agree with Mr. Kestenbaum’s assessments.
In addition, due to worldwide demand and the rising prices of other key basic ingredients (such as hydrofluoric acid and sulfur) the refrigerant R-134A (and others) will also become more costly. At the same time, increasing federal restraints on the production of HCFC refrigerants (such as R-22) and the lack of industry recovery efforts are making these refrigerants far more precious.
Are there any new refrigerants on the horizon that we can look to in order to solve these problems? DuPont was touting their new Opteon XP10 at the Expo as a possible future replacement for R-410A (which has a high global-warming potential), but it uses the same basic ingredients. No major quantities of this refrigerant will become available until a new manufacturing plant comes online sometime in 2014 (they’re awaiting new legislation which will require its use).
My suggestion? Stock up!
Jim Wheeler has been active in the HVACR industry as a contractor, national service manager, and trainer for more than 37 years, and as an award-winning industry writer/editor for the past 24 years. You may contact him at jimwheeler@ij.net.
To me, one of the most important reasons for attending each year’s AHR Expo is having the opportunity to sit down with some of the people who really know what’s going on in our industry, in order to find out what issues facing us may be critical. While attending this year’s show in Las Vegas in January, and after speaking to Jay Kestenbaum, senior vice president of Airgas Refrigerants Inc., I was shocked!
The news he shared with me was nothing really new. However, what shocked me is that nobody seems to be worried about it, and few people appear to understand the problems that will be created for us! He pointed out that our industry is facing a critical shortage of one of the key ingredients for all our HFC refrigerant blends, R-125, and it looks like we are going to see a lack of availability of such products as R-410A and dramatically rising prices as this year progresses. In fact, he suggested that wholesale prices could go as high as $20 to $30 per pound by the end of the year, since no price increase will make the refrigerants more available!
The problem, as he explained it, is that the primary source of a key HFC ingredient (fluorine gas) - China - is in the midst of its greatest building boom ever, and everyone wants air conditioning. So their sales of A/C units suddenly jumped from 65 million to 98 million! As a result, the major share of R-125 is being used within their own country, leaving the rest of the world in a severe shortage condition.
This isn’t an artificial problem that’s being created to raise prices like the great “toilet paper shortage” of the early 1970s. The mineral fluorspar, from which we get fluorine gas, is only found in large quantities in China (though some is found in Mexico and some in Indiana ???), and their methods of extracting it are still a bit antiquated. So the Chinese aren’t geared up to handle the increased volume.
I double-checked this information with other refrigerant manufacturers and found that they agree with Mr. Kestenbaum’s assessments.
In addition, due to worldwide demand and the rising prices of other key basic ingredients (such as hydrofluoric acid and sulfur) the refrigerant R-134A (and others) will also become more costly. At the same time, increasing federal restraints on the production of HCFC refrigerants (such as R-22) and the lack of industry recovery efforts are making these refrigerants far more precious.
Are there any new refrigerants on the horizon that we can look to in order to solve these problems? DuPont was touting their new Opteon XP10 at the Expo as a possible future replacement for R-410A (which has a high global-warming potential), but it uses the same basic ingredients. No major quantities of this refrigerant will become available until a new manufacturing plant comes online sometime in 2014 (they’re awaiting new legislation which will require its use).
My suggestion? Stock up!
Jim Wheeler has been active in the HVACR industry as a contractor, national service manager, and trainer for more than 37 years, and as an award-winning industry writer/editor for the past 24 years. You may contact him at jimwheeler@ij.net.
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