Why is R134a refrigerant price rising sharply in 2026 and what drives the market?

Why is R134a refrigerant price rising sharply in 2026 and what drives the market?
R134a prices have climbed notably in 2026, with the domestic spot index up about 15% year-to-date and the premium-grade price rising from roughly 57,333 yuan/ton in April to 63,667 yuan/ton by early July. The core driver is China's quota system for third-generation refrigerants, which caps 2026 production at 797,800 tons, nearly zero growth from prior years. Supply discipline has tightened while downstream demand, especially from automotive air conditioning and refrigeration servicing, remains steady. Additionally, the US government extended compliance deadlines for HFC refrigerants in May, easing usage restrictions and supporting global demand. Overseas, UK wholesaler Beijer Ref UK raised R134a prices by 35% in May, reflecting similar cost pressures. With 2027 quotas expected to mirror 2026 levels, the supply-demand balance should keep prices elevated, supporting a recovery in producer margins.