Aluminum Fluoride Prices Plummet Under Dual Pressure of Costs and Demand [SMM Fluoride Weekly Review]

SMM, February 13:

This week, tender prices from downstream benchmark enterprises were finalized. Affected by loosening raw material costs and weak demand, aluminum fluoride prices were significantly reduced. As of now, SMM aluminum fluoride prices closed at 10,600-11,200 yuan/mt, while SMM cryolite prices were quoted at 6,500-7,200 yuan/mt.

Raw material side, the fluorite market remained stable, with the delivery-to-factory price of 97% fluorite powder required by aluminum fluoride enterprises staying at 3,450-3,800 yuan/mt. Currently, mine operating rates remained at low levels, and downstream market procurement was slow, focusing mainly on just-in-need orders to consume inventory. According to SMM data, the average delivery-to-factory price of 97% fluorite powder was 3,617 yuan/mt, flat MoM. Meanwhile, the price of another raw material, aluminum hydroxide, continued to decline due to weaker raw material support. SMM recorded the ex-factory average price of aluminum hydroxide at 2,485 yuan/mt, down 7.53% MoM. This situation led to softer cost-side prices for aluminum fluoride, thereby weakening the overall price support for aluminum fluoride.

Supply side, some enterprises gradually resumed operations after the holiday, leading to a recovery in supply compared to pre-holiday levels. Demand side, although the operating capacity of aluminum increased, some enterprises had already completed inventory stocking for this month before the holiday, leaving overall market demand relatively weak.

Brief Comment: Currently, downstream aluminum benchmark enterprises have completed tender pricing, and the aluminum fluoride market's focus has shifted to order delivery. In February, aluminum fluoride prices followed mainstream prices, significantly reducing to around 10,600 yuan/mt. After aluminum fluoride prices were finalized, despite the recovery in supply, the signing of new orders by enterprises was not ideal. The weak downstream demand is unlikely to improve effectively in the short term, coupled with the weakening cost-side support. SMM expects aluminum fluoride prices to face certain downward pressure in the short term.

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