Lowered Tender Prices by Aluminium Plants Led to reduced Aluminium Fluoride Production

SHANGHAI, Aug 5 (SMM) - In August, the tender prices of aluminium fluoride by aluminium plants were lowered to 8,500 yuan/mt. SMM prices for aluminium fluoride and cryolite stood at 8,500-9,200 yuan/mt and 7,000-8,000 yuan/mt respectively. In terms of raw materials, according to the feedback from enterprises, the prices of fluorite in August remained 2,700-2,800 yuan/mt, and the prices of 98% sulphuric acid fell significantly to about 400 yuan/mt, which weakened the support for aluminium fluoride prices. On the supply side, as aluminium plants lowered their bidding prices, the profits of aluminium fluoride enterprises were reduced as well, and some enterprises switched to the production of hydrofluoric acid, which was more profitable. Generally speaking, fluorite prices remained rangebound at a high level, while sulphuric acid prices fell too fast that the cost support of aluminium fluoride weakened. Cryolite prices continued to be stable, and the tight supply of raw materials eased slightly. In August, the declining bidding prices of aluminium plants greatly discouraged the production of aluminium fluoride enterprises, some of whom switched to the production of hydrofluoric acid due to losses on aluminium fluoride. In that case, SMM believes that aluminium fluoride prices are likely to face downward pressure in the short term. The transactions are expected to be muted with weak downstream demand.