SMM, September 24:
This week, China's aluminum fluoride market saw steady trading, with aluminum fluoride prices edging up. As of now, SMM mainstream quotations for aluminum fluoride stand at 11,500-12,500 yuan/mt. Cryolite spot prices also edged up, with SMM cryolite quotations at 8,300-9,000 yuan/mt.
Raw materials: This week, aluminum fluoride raw material prices diverged. Upstream 97% fluorite wet powder market remained stable with an upward bias, with mainstream delivered prices at 3,350-3,850 yuan/mt. Supply remained tight, as environmental and safety inspections in main producing areas became routine, keeping mine and beneficiation plant operating rates low. Some enterprises were still in rectification, limiting production resumptions. Mongolian imports supplemented the northern market, but arrival growth fell short of expectations. Miner inventories were low, and the tight ore supply pattern is unlikely to reverse in the short term. Demand side, the October refrigerant peak season is winding down, and export expectations are declining, which will weigh on upstream raw material procurement. Hydrofluoric acid operating rates face pullback pressure, and downstream fluorite demand is under pressure. Overall, low operating rates and miners holding prices firm provide bottom support for prices, but weakening downstream demand and imported supply are capping upside. The market is in a stalemate, and fluorite powder prices are expected to remain largely stable in the short term. For other raw materials, China's aluminum hydroxide market was largely stable, with SMM weighted average price at 1,650 yuan/mt, unchanged WoW. The sulphuric acid market continued to ease from earlier highs, with transaction centers extending a slight downward trend. Overall raw material prices were mixed, and some price pullbacks partially offset cost pressure. However, with fluorite staying high, overall aluminum fluoride production costs pulled back slightly but remained elevated.
Supply side: Industry costs stayed high, with enterprises generally posting production losses and keeping operating rates low. High fluorite prices continued to push up aluminum fluoride costs, while the recent decline in sulphuric acid prices brought a slight recovery in profitability but has not yet driven enterprises to ramp up production. Enterprises in the market were shrinking operations, prioritizing contracted deliveries. New effective supply was insufficient, and spot cargo was tight. Demand side: Aluminum operating capacity remained high, creating rigid demand for aluminum fluoride and providing bottom support for prices. However, downstream buyers purchased as needed, lacking concentrated restocking, so upward price momentum was weak.
SMM Commentary: This week, aluminum fluoride raw material trends diverged: fluorite prices stayed firm at high levels, providing strong cost support, while sulphuric acid prices pulled back slightly, partially offsetting cost pressure. Industry production pressure eased slightly, but profit margins remained narrow and production enthusiasm was insufficient, keeping industry operating rates low. Demand side, aluminum enterprises maintained high-load operations, creating rigid support for aluminum fluoride consumption, but procurement lacked elasticity. The market had no concentrated restocking catalyst, limiting upward momentum for spot prices. Going forward, focus on fluorite raw material price fluctuations and the pace of restocking by aluminum enterprises.
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