Aluminium fluoride prices rise on cost support; premium for high-grade supply widens

This week, trading sentiment in China's aluminium fluoride enterprises was moderate, and aluminium fluoride prices continued to rise. As of now, SMM mainstream quotations for aluminium fluoride stand at RMB 11,500-12,300 per tonne; cryolite spot prices firmed, with SMM cryolite quotations at RMB 8,000-9,000 per tonne.

Raw material side: This week, aluminium fluoride raw material prices diverged. The upstream 97 per cent fluorite wet powder market edged up, with mainstream delivered prices at RMB 3,350-3,850 per tonne. Supply side, mine safety inspections remained intense: Inner Mongolia implemented the "Double Ten" inspections, Zhejiang's small mine closure policy took effect, compliance checks continued in Jiangxi and Fujian, mine production resumptions were delayed, fluorite inventory stayed low, spot supply was tight, and cargo was prioritised for long-term contracts; Mongolian imports rebounded somewhat, only slightly easing supply pressure in the north. Demand side showed clear divergence: hydrofluoric acid supply contracted, September long-term contract prices were raised to above RMB 15,000 per tonne, driving some restocking demand; refrigerants were constrained by quotas, lithium battery fluorochemical demand was weak, and downstream purchase willingness for high-priced fluorite was cautious, with buying largely on an as-needed basis. Overall, rigid constraints at the mine end underpinned the cost floor, but downstream lacked concentrated stockpiling drivers, and fluorite is expected to consolidate at high levels with a slight upward bias in the short term. For other raw materials, China's aluminium hydroxide market was largely stable, with SMM weighted average price at RMB 1,650 per tonne, unchanged W-o-W; the sulphuric acid market continued to ease from previous highs, with transaction centres extending a slight downward trend. Overall raw material prices were mixed, and some price pullbacks partially offset cost pressure, but with fluorite staying high, comprehensive production costs for aluminium fluoride remained elevated.

Supply side: The industry remained in a weak cycle of high costs, production losses, and low operating rates. High fluorite prices continued to underpin aluminium fluoride production costs, making it difficult to repair industry profitability. Most enterprises stepped up equipment maintenance and flexible production cuts, keeping the overall industry operating rate low. At this stage, enterprises generally adopted a contractionary operating strategy, prioritising long-term contract deliveries, with limited new effective supply and overall tight spot cargo. Demand side: Downstream aluminium industry operating capacity stayed high, creating sustained rigid demand for aluminium fluoride and providing bottom support for market prices.

SMM Commentary: This week, aluminium fluoride raw material trends diverged: fluorite prices remained firm at high levels, providing strong cost support; sulphuric acid prices pulled back slightly, partially offsetting cost pressure, but comprehensive production costs in the industry remained high, profitability was narrow, production enthusiasm was insufficient, industry operating loads were low, and supply was generally tight. Demand side, aluminium enterprises maintained high-load operations, creating rigid support for aluminium fluoride consumption, but purchasing lacked elasticity, there were no concentrated restocking positives in the market, and spot price upside momentum was limited. SMM also learned that high-grade aluminium fluoride prices, supported by costs, rose to around RMB 12,400-12,800 per tonne during the week. Overall, the current aluminium fluoride market shows a pattern of "cost support, tight supply, and inelastic demand," with future focus on fluorite raw material price fluctuations and the pace of restocking by aluminium enterprises.

Note: This article has been issued by SMM and has been published by AL Circle with its original information without any modifications or edits to the core subject/data.