The future of R-134A is anything but certain. There have been a lot of changes towards R-134A in 2014 and there are many more to come in 2015.
Mexi-Chem and Their Law-Suit
Towards the end of 2013 a refrigerant manufacturing company called Mexi-Chem filed a law-suit under the International Trade Commission. The suit was filed due to the amount of Chinese R-134A coming into the North America market and due to the low price point that this product was coming in.
It seemed that the quantity that was being imported was doubling every year and the price that it was being brought in was around $40-$50 a jug. This provided a huge margin for the companies that were bringing in the Chinese product but it also caused the market’s price on R-134A to drop. The big players in North America had to compete against the Chinese product so they dropped their price and it overall led to a better price to the consumer.
The lawsuit that Mexi-Chem filed at the ITC was alleging that the Chinese product being brought in was harming the North American industry. Mexi-Chem wanted the ITC to impose significant tariffs on all imported R-134A. The tariffs would allow Mexi-Chem and other American based companies to be competitive with the low cost Chinese alternative.
The suit was originally filed at the tail end of 2013 and there was a ruling made on November 12th, 2014. The ruling stated that the imported product is NOT hurting the North American industry and that new tariffs would not be issued. Mexi-Chem has said that they will appeal the ruling in hopes of getting the tariff issued at a later date.
When the news of the law suit first came out it sent the price of R-134A through the roof. My company was buying in between the $60s and $70s towards the beginning of 2014. When the news became more main-stream the price practically doubled to $140 a jug.
Since the ruling came out just a few days ago the price has already dropped back down to early 2014 levels. I have already seen quotes on pallets of R-134A at $70.00 a jug. The Chinese product is back and stronger than ever! I don’t know about you but I am in favor of the cheaper Chinese product coming in to the country. It gives the consumer an ultimately lower cost. If a few of the big conglomerates such as HoneyWell or DuPont have to make a little less per jug so be it.
Obama Pushing Phase-Out of R-134A
I talked about this in a previous article but I believe it needs another mention. (The previous article can be found by clicking here.)
It was announced in September that the Obama administration would be pushing a ‘voluntary’ phase out of R-134A across the country. This latest phase-out is due to R-134A’s contribution to global warming. R-134A’s predecessor R-12 was damaging the O-Zone layer whenever it was released into the atmosphere.
R-134A does not damage the O-Zone BUT it does contribute to green-house gases and does warm the planet. The phase-out on R-134A is voluntary at this point in time mainly due to the fact that ere is not a main-stream replacement product for R-134A.
The major manufacturers of refrigerant/Refrigerant in the United States have all agreed to rapidly produce an R-134A replacement product and to take extra steps to reduce R-134A leaks into the environment.
As I said before, all of this is voluntary but I would give this another year, maybe two, and these new regulations that were announced will become mandatory just as the R-22 Refrigerant was banned entirely in 2010.
I don’t see this affecting the price of R-134A too much in 2015 but it is worth noting and to keep an eye open for any new government regulations on the Refrigerant industry.
Who knows will R-134A will be in a couple years. It may still be the industry standard or it may be on it’s way out. Either way 2014 was a crazy year for the Refrigerant industry.
Are you interested in purchasing R-134A either by the jug or the pallet? If so check out the few links below!