That is incorrect.
HRTF are entirely about placing sound around you by emulating the cues provided by your natural hearing. Specifically there are three ways we place sound in space around us:
Specifically, we have a large, hopefully dense material between our two ear canals. As a result, Amplitude and Timing will be different based off where the sound comes from one side or another. This is also part of why lower frequencies that are good at diffracting around our head are more difficult for us to locate in space, and why you are generally good going mono with bass frequencies.
But the pinnae of our ears also affect the sound, changing the timbre in ways that we don’t always even recognize as our brain also compensates for it. Sounds coming from the front get focused into the ear canal by the pinnae, and have a brighter sound, whereas sounds from the rear are partially blocked by the pinnae, specifically some of the HF material. This happens in specific ways our brains recognize and account for and helps us place sounds behind or in front of us.
Combined with the ability to place in the left/right using the above cues this allows us to place sounds in a 2D space around us fairly easily.
Now to the OP’s original question, along with HRTF which typically only work on headphones as it requires specific timings as well as direct unimpeded access to our ear canals, or at the very least is far less effective in open space, there are other ways we place things as well. As people have commented, volume is obviously one, louder sounds help us place things as closer, vs farther away, but also timbre, we hear a bit more bass in closer sounds for instance. Along with this direct vs reverberant sound is another cue for us, the more reverb we hear we naturally tend to place those sounds farther away.
So judicious use of two processes really help us with this. Compression can be used to bring things to the forefront by increasing the apparent volume even moreso than just turning up the fader, as well as adjusting timbre based on compression vs frequency content, and reverb processes pull things into the background by decreasing that direct vs reverberant ratio. Combined with some judicious EQ work, this can provide the second dimension to a 2 dimensional soundstage, increasing the bass slightly for sounds you want to sound closer, decreasing it slightly for those farther back, and adjusting the HF response to emulate whether it is facing directly to you or not, etc. You can get very detailed with this if you really choose to by modifying the sound of reverb vs the direct sound etc. to help place it farther but you do hit a law of diminishing returns very quickly, so I don’t really recommend going that distance for many things.