Upstream price hike slows as demand stall

*From August 3 onwards, wafer prices will be posted based on 155μm of thickness, in accordance with official pricings of manufacturers.
 

Polysilicon

Real polysilicon supply slowly increases and is little changed in August. Monthly production volume may see marginal decline, as some manufacturers undergoing line modifications have yet to re-initiate production. Supply tightness persists, and the ill-balanced supply-demand relationship is not likely to abate in the short term.

Prices for mono-grade polysilicon keep rising. To date, new orders are sealed at RMB 295-308/kg. Overall, prices stay on an upward trend, albeit some variations. Some orders other than long-term orders are signed at nearly RMB 310/kg.

Buyers and sellers each face different challenges. Buyers from the wafer sector, faced with elevated polysilicon prices, fail to acquire sufficient polysilicon for production. Meanwhile, it is a long order for polysilicon manufacturers to deliver products at the contracted quantity.

* Investigation of InfoLink covers polysilicon prices at which orders have been delivered from the previous Thursday to this Wednesday and have been signed recently. We track mainstream prices and provide feedback for the industry. Therefore, changes and future price trend will gradually emerge during periods of higher order volume. Prices for sporadic orders are to be heeded.
 

Wafer

Mono-Si wafers with 155μm of thickness become more available on the market than 160μm ones. In line with that, from August onwards, InfoLink will post prices for mono-Si wafers based on 155μm of thickness.

Leading manufacturers keep raising prices for mono-Si wafers, as limited polysilicon supply crimps production volume this month. This week, wafer prices rise on higher polysilicon costs. Buyers seem to accept such increases in wafer prices, for shipments are as usual for the time being.

On July 21, Zhonghuan raised prices for 210mm wafers with a thickness of 155μm by RMB 0.38/piece to RMB 9.93/piece, a 4% increase. On July 25, Longi announced to have adjusted the thickness of its p-type M10 wafers to 155μm, and prices upwardly by 4% to RMB 7.54/piece. Prices for p-type M6 cells with a thickness of 160μm are marked up by 4.1% to sit at RMB 6.33/piece.

Tier-2 and Tier-3 wafer manufacturers follow suit. Overall, mono-Si wafer prices increase. In the short term, upstream prices will be firmly up and not likely to drop, as subject to limited supply. In September, if the dry spell end user demand, especially Chinese ground-mounted projects, continues, price acceptance of the cell sector and utilization rates of the module sector will determine whether upstream price hikes will last.
 

Cell

Cell prices stay at last week’s level, with some marginal changes in the high and low-price range, and deepening discrepancy among module makers’ acceptance of cell prices.
Tier-1 cell manufacturers stand firm in negotiations with module makers. However, major module makers appear more in a holding pattern. Some of them cut production in the first half of August. The rest do not rule out the possibility to follow suit, as a bargaining chip against potential cell price hikes. Some module makers aim to buy cells at RMB 1.26-1.28/W.
Tier-2 module makers keep trimming down utilization rates, paring back purchases of high-priced cells, to keep production costs in check. Some small-scale module makers accept the new price quotes, to keep higher utilization rates and deliver orders previously signed.

This week, cell trading prices for M6, M10, and G12 cells come in at RMB 1.28/W, RMB 1.29-1.31/W, and RMB 1.27-1.28/W, respectively.

Cell prices are expected to sustain in the short term, especially in such a moment when short polysilicon supply makes it difficult for cell manufacturers to acquire wafers. However, dissents from downstream buyers emerge. Whether such pressure will ripple to upstream sectors by August and September requires further observation.
 

Module

Successive price hikes across the supply chain build up module production costs. In August, module makers raised price quotes by RMB 0.02-0.02/W to RMB 1.99-2.05/W for glass-backsheet modules rated beyond 500 W, and to RMB 2.03-2.08/W for glass-glass ones. (Delivering price excluding inland transport costs).

Module prices stagnate they did as in July, for projects are in deep inertia. Glass-backsheet modules rated beyond 500 W are delivered at RMB 1.93-2.05/W (inland transport costs excluded), and their glass-glass counterparts at RMB 1.95-2.08/W (inland transport costs excluded). New orders are few, sealed at RMB 1.95/W by utility-scale ground-mounted projects, and RMB 2/W by distributed projects. Still, trading prices sustain at levels of previous delivering prices, with glass-backsheet modules being traded mostly at RMB 1.97-2.05/W.

In overseas markets, price quotes rise on increasing production costs. However, end users can bear such lofty module prices no more. This week, prices stay at last week’s level at USD 0.267-0.275/W (FOB) in the Asia-Pacific region, and USD 0.27-0.285/W in Australia. In the U.S., prices sustain at USD 0.33-0.38/W, with some pick up slightly by USD 0.01/W. Prices for locally made modules sit at USD 0.55-0.58/W. In Europe, glass-backsheet modules rated beyond 500 W are delivered at USD 0.26-0.285/W, and USD 0.285-0.29/W on the spot market. Price quotes for new orders in August keep rising. European end users switch to a wait-and-sit approach. Inventory draws from some projects are suspended, due to unsteady inverter supply and port labor issues.

Lofty module prices start putting off demand in August. Utility-scale projects yield no progress. Overseas markets start finding it difficult to accept such expensive modules. High prices, high production costs, and waning demand affect utilization rates this month. Tier-1 module makers keep utilization rates at 70-80%, mostly sitting on the fence for future developments. Meantime, mid and small-scale module makers keep utilization rates at 30-60%. In August, production output of module makers further differentiates.

In Southeast Asia, module makers cut utilization rates to 50-60%, as subject to the Uyghur Forced Labor Prevention Act. Most large-scale makers failed to export products to the U.S. Overall, future development hinges on whether module makers can pass cost pressure onto upstream sectors.
 

N-type cell and module

This week, prices stabilize temporarily, as the market has yet to see many price quotes for n-type products. G12 HJT modules are expected to be available by the end of the third quarter. We will decide whether we should post the spot price of G12 HJT products in the fourth quarter of the year, considering mass production activities of all manufacturers.

As production costs rise, most n-type cell manufacturers are still delivering orders previously signed, with prices stabilizing. Prices for M6 HJT cells come in at RMB 1.36-1.45/W for M6 HJT cells. M10 and G12 TOPCon cells have not seen much trading by far, mostly purchased for in-house capacities, at RMB 1.3-1.37/W for the time being.

Module prices temporarily sustain this week, coming in at RMB 2.15-2.2/W for M6 HJT modules, and USD 0.285-0.33/W in overseas markets.

M10 and G12 TOPCon module prices stay where they were last week, at RMB 2.06-2.11/W for monofacial ones, RMB 2.09-2.15/W for bifacial ones, and around USD 0.28-0.31/W in overseas markets.