SMM September 18:
Aluminum fluoride producers focused on order deliveries this week, with moderate market activity and stable prices. SMM aluminum fluoride prices closed at 9,480-9,800 yuan/mt, while SMM cryolite was quoted at 7,300-9,500 yuan/mt.
Cost side, 97% fluorite powder delivery-to-factory prices for aluminum fluoride producers currently range from 3,250-3,450 yuan/mt, with fluorite prices holding up well this week. Market drivers include increased mining difficulty and higher extraction costs as winter approaches, coupled with downstream enterprises initiating winter stockpiling to counter supply fluctuations. These factors have intensified market hoarding and reluctance to sell, strengthening support for fluorite prices, which show a near-term upward trend. Aluminum hydroxide prices continued to weaken, with the SMM weighted average price at 1,917 yuan/mt, down 2.29% WoW. Sulphuric acid market fundamentals remained weak, with prices under pressure. Overall, despite mixed raw material price movements, fluorite's strength is pushing up aluminum fluoride production costs.
Supply side, limited profit margins and persistently high production costs have reduced producer enthusiasm. Additionally, low enterprise inventory has constrained overall market supply flexibility. Demand side, although operating capacity in the downstream aluminum industry edged up, buyers maintained a cautious procurement approach, covering only basic production needs without large-scale orders, resulting in limited demand release.
Brief: Aluminum fluoride raw material prices continued to diverge this week. While raw material trends were mixed, cost-side fundamentals remained high, increasing profit pressure on producers, with some even reporting losses. Supply and demand showed no significant fluctuations, with no key variables to disrupt the balance. Notably, persistently high cost pressure has significantly boosted producers' price hike sentiment, but market feedback will determine if increases materialize. Future attention should focus on dynamic changes in raw material costs and adjustments in downstream procurement pace.
