China’s AlF3 prices still climbing in August 2019, expected to remain stable short term 09-17-2019

The price of aluminum fluoride continued to increase in August 2019 in China. Generally, the bidding price given by mainstream aluminum enterprises averaged up to USD 42.46 (RMB 300) per ton. CHALCO offered USD 1,407.92 (RMB 9,950) per ton of aluminum delivered; the East Hope Group in Baotou and Xinjiang, Shandong Weiqiao Pioneering Group as well as Xinfa Group offered respectively USD 1443.30 (RMB 10,200), USD 1471.60 (RMB 10,400), USD 1386.70 (RMB 9,800) and USD 1386.70 (RMB 9,800) per ton of aluminum delivered.

Affected by the strong Typhoon Leech, devices in many mainstream aluminum fluoride factories in Shandong, a province with high productivity in China, have recently experienced overhauls. Also, the lead time for many aluminum fluoride factories on their orders was usually one month. As a result, the aluminum fluoride in stock was limited.

However, the price of aluminum fluoride began to remain stable after a short impact of typhoon Leech. Currently, aluminum fluoride factories have quoted a price ranging from USD 1471.60 (RMB 10,400) to USD 1556.50 (RMB 11,000) per ton of aluminum fluoride while the bidding price given by aluminum enterprises mainly ranges from USD 1386.70 (RMB 9,800) to USD 1471.60 (RMB 10,400) per ton.

In the first half of 2019, the overall profit in aluminum fluoride industry in China was declining. After seeing losses in April, aluminum fluoride enterprises started to make high profits in the second half of 2019, earning USD 269.13 (RMB 1,902) per ton in August. Aluminum fluoride enterprises are expected to earn more due to the decreasing price of fluorite, aluminum hydroxide as well as sulfuric acid.

Typhoon Leech exerts little impact on the ongoing trend of AIF3 prices

Some sources analyze the trend of the aluminum fluoride industry in the aspect of the cost, supply, and demand.

First, the price of fluorite, the main material of aluminum fluoride, is expected to keep going down in the near future. The cost of obtaining aluminum fluoride from factories will decrease.

Second, the aluminum fluoride factories that were overhauled in summer began to operate again, with an increasing supply in stock.  However, a recent overhaul of many aluminum fluoride factories in Shandong province affected by Typhoon Leech led to a decreasing supply of aluminum fluoride in stock. The lead time of one month for many aluminum fluoride factories on their orders made the inventory of finished goods scarce.

Third, regarding the demand of aluminum fluoride, the downstream electrolytic aluminum enterprises are expected to extend their bidding prices and replenish their supplies in September, due to the consumption of fluorite inventory.

According to a market insider, the regulation of Shandong Environmental Protection Policy was implemented beginning August 15.  Fossil industries may no longer start or stop production arbitrarily from the beginning of September. The regulation may remain until after October 8. In September, aluminum fluoride factories maintained stable production and the total market supply experienced little change. In general, the stock price of aluminum fluoride remained steady in mid to late August and were estimated to increase slightly in September, while the increase might continue after September.

For more information about China’s fluoride market, please have a look at our monthly newsletter China Fluoride Materials Monthly Report.

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