Raw material divergence coupled with insufficient demand boost, aluminium fluoride enterprises primarily rely on long-term contracts for deliveries

SMM september 11:
This week, aluminium fluoride enterprises focused on fulfilling orders, with moderate market activity and stable prices. As of now, SMM aluminium fluoride prices closed at RMB 9,480-9,800 per tonne, and SMM cryolite prices were quoted at RMB  7,300-9,500 per tonne.

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. Aluminium hydroxide prices continued to weaken this week, with SMM recording a weighted average price of RMB 1,962 per tonne, down 3.21per cent w-o-w; the sulfuric acid market fluctuated at a high range-bound. Overall, the cost side of aluminium 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 aluminium 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 aluminium 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.

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.