Raw Material Divergence Coupled with Insufficient Demand Boost, Aluminum Fluoride Enterprises Primarily Rely on Long-Term Contracts for Deliveries [SMM Fluoride Salt Weekly Review]

SMM September 11:

This week, aluminum fluoride enterprises focused on fulfilling orders, with moderate market activity and stable prices. As of now, SMM aluminum fluoride prices closed at 9,480-9,800 yuan/mt, and SMM cryolite prices were quoted at 7,300-9,500 yuan/mt.

From the raw material perspective, the delivery-to-factory price of 97% fluorite powder for aluminum fluoride enterprises currently concentrated in the range of 3,150-3,350 yuan/mt, and fluorite prices mainly fluctuated rangebound this week. In terms of market drivers, as winter approaches, increased mining difficulty has led to higher extraction costs, while downstream enterprises have initiated winter stockpiling demand to cope with supply fluctuations. The combination of these two factors has intensified market hoarding and reluctance to sell, directly strengthening the support logic for fluorite prices, presenting a pattern of being more likely to rise than fall in the short term. Aluminum hydroxide prices continued to weaken this week, with SMM recording a weighted average price of 1,962 yuan/mt, down 3.21% WoW; the sulfuric acid market fluctuated at highs rangebound. Overall, the cost side of aluminum fluoride remained at high levels this week.

Supply side, limited profit margins and persistently high production costs have affected enterprise production enthusiasm, but operations remained stable, with overall supply relatively sufficient and enterprise inventory at low levels. Demand side, although operating capacity in the downstream aluminum industry increased slightly, procurement parties generally maintained a cautious attitude, limiting purchases to basic needs, with no large-scale orders observed.

Brief Review: This week, the aluminum fluoride market continued its divergent trend, with mixed raw material movements but overall not altering the fundamental high-cost environment, increasing profit pressure on producers; current market supply is relatively ample, with stable production at mainstream enterprises, and although sporadic positive signals emerged on the demand side, they did not translate into substantial support, as enterprise procurement focused on rigid demand, resulting in limited actual transaction volumes. Against this backdrop, producers mostly focused on fulfilling existing orders to ensure cash flow stability, with in-factory inventory generally maintained at low levels or even no inventory, warranting close attention to dynamic changes in raw material costs and adjustments in downstream procurement pace.