Tender pricing finalized, aluminum fluoride prices continue to decline slightly amid weak supply and demand [SMM Aluminum Fluoride Salts Weekly Review]

SMM News on June 5:

This week, the tender prices for aluminum fluoride were finalised by downstream benchmark enterprises. Aluminum fluoride prices declined slightly, with SMM aluminum fluoride prices closing at 9,630-9,900 yuan/mt as of now, while SMM cryolite was quoted at 7,500-9,500 yuan/mt.

From the perspective of raw material supply, the raw material market fluctuated downward. The fluorite market remained sluggish, and the current tight supply situation in the fluorite powder market has eased somewhat, supplemented by imported sources, making the market supply side relatively abundant. On the demand side, end-use consumption was weak, and downstream enterprises had a strong wait-and-see sentiment. It is expected that fluorite prices will continue to weaken. As of now, the average delivery-to-factory price of 97% fluorite powder is 3,367 yuan/mt. Prices continued to weaken this week, down 4.7% WoW. Additionally, the market for other raw materials of aluminum fluoride also showed a weakening trend. Affected by the easing of alumina prices, aluminum hydroxide prices remained stable this week, with an average ex-factory price of 2,131 yuan/mt, up approximately 1.09% WoW. Sulphuric acid prices remained relatively stable. Overall, the production cost of aluminum fluoride showed a downward trend.

Due to poor profits of aluminum fluoride enterprises, the enthusiasm for production on the supply side was low, resulting in a long-term low level of capacity utilisation rate. Although the operation of downstream aluminum enterprises on the demand side was good, procurement sentiment was average, mainly to maintain just-in-time procurement. Therefore, the support for aluminum fluoride prices from both supply and demand sides was relatively limited.

Brief Commentary: Downstream benchmark aluminum enterprises have completed tender pricing this week. In June, aluminum fluoride prices fell significantly to 9,630-9,700 yuan/mt, a decrease of 150-200 yuan from the previous month. The current aluminum fluoride market continues to exhibit weak supply and demand, with a poor performance in the raw material market and a decline in cost support, leading to a slight drop in prices this month. With both raw material and finished product prices declining, corporate profitability has not improved, and enterprises continue to operate at a low level. Coupled with the absence of positive factors on the demand side, aluminum fluoride prices are expected to remain stable in the short term.