SMM, September 3:
This week, benchmark downstream enterprises finalised their aluminum fluoride tender prices, and aluminum fluoride prices moved upward. As of now, SMM mainstream quotations for aluminum fluoride stand at 11,500-12,000 yuan/mt; cryolite spot prices firmed, with SMM cryolite quotations at 8,000-9,000 yuan/mt.
Raw material side: This week, aluminum fluoride raw material prices diverged. Upstream 97% fluorite wet powder market rose steadily, with mainstream delivered prices at 3,350-3,850 yuan/mt. Supply side, high-pressure safety inspections at mines continued unabated: Inner Mongolia implemented the "Double Ten Measures" inspections, Zhejiang's small mine closure policy took effect, compliance checks in Jiangxi and Fujian remained ongoing, mine production resumptions were delayed, fluorite inventory stayed low, spot supply was tight, and cargo was prioritised for long-term contracts; Mongolian imports rebounded somewhat, only slightly easing supply pressure in the north. Demand side, hydrogen fluoride supply contracted, and September long-term contract prices were raised to above 15,000 yuan/mt, driving some restocking for rigid demand; refrigerant operating rates were restricted, the lithium battery industry chain remained weak, and downstream high-price purchase willingness was limited, with buying on an as-needed basis. Fluorite consolidated on a strong note at high levels within a narrow range. For other raw materials, China's aluminum hydroxide market was largely stable, with SMM weighted average price at 1,650 yuan/mt, unchanged WoW; the sulphuric acid market loosened from earlier highs, with transaction center continuing to edge lower. Overall, raw material prices showed mixed changes, and some price pullbacks partially offset cost pressure, but with fluorite holding at high levels, comprehensive production costs for aluminum fluoride remained elevated.
Supply side: The industry remained in a weak cycle of persistently high costs, production losses, and low operating rates. High fluorite prices continued to underpin aluminum fluoride production costs, making it difficult to restore industry profitability. Most enterprises continued to step up equipment maintenance and flexible production cuts, keeping overall industry operating rates at low levels. At this stage, enterprises in the market generally adopted a contractionary operating strategy, prioritising delivery of long-term contract orders. New effective supply in the market was limited, and spot cargo remained tight overall. Demand side: Downstream aluminum industry operating capacity stayed high, generating sustained rigid demand for aluminum fluoride and providing bottom support for market prices.
SMM Comments: This week, aluminum fluoride raw material trends diverged: fluorite prices remained firm at high levels, providing strong cost support; aluminum hydroxide and sulphuric acid prices pulled back slightly, partially offsetting cost pressure. However, comprehensive production costs in the industry remained high, corporate profitability was narrow, production enthusiasm was insufficient, industry operating loads were low, and supply remained tight overall. Demand side: Aluminum enterprises maintained high-load operations, providing rigid support for aluminum fluoride consumption, but procurement lacked elasticity, and there was no concentrated restocking catalyst in the market, limiting upward momentum in spot prices. Price side: During the week, benchmark enterprises finalised September tender prices, raising them by 300-500 yuan/mt overall. High-grade aluminum fluoride transaction center climbed to 12,000-12,500 yuan/mt, with cost-driven price increases transmitting smoothly. In addition, recent gains in anhydrous hydrogen fluoride prices provided some positive support to the broader fluorochemical industry chain. Overall, the current aluminum fluoride market presents a pattern of "cost support, tight supply, and inelastic demand." Going forward, focus should be on fluorite raw material price fluctuations and the pace of restocking by aluminum enterprises.
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