Wafer prices fall on pressure, upstream negotiations intensify

Polysilicon

Negotiations intensify between upstream sectors, amid mixed market sentiment in November.

Mainstream prices are little changed for mono-grade polysilicon, but with its range slowly widening, and high-price range dips. The ingot segment’s inelastic demand for polysilicon will be more evident, as manufacturers start sealing orders. The intensity of price negotiations is going to be the focus of the month in upstream sectors.

Anticipation for price declines deepens. Traders have been depleting inventories faster since September, sending a stronger signal for price declines on the spot market, albeit being a small portion of total sales. Polysilicon buyers, on the other hand, keep reducing dealer inventories and stockpiles within production segments, in the hope to mitigate or prevent inventory loss.

The end of the year will be a tipping point of the supply-demand relationship in the upstream. Polysilicon will not see sharp price declines in the short term. Future price trend hinges on the ingot segment’s utilization rates in November.

* 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

Zhonghuan updated mono-Si wafer pricings on October 31, revising prices downwardly for all products, including 210mm ones, a 3.1-3.3% decrease compared to pricings announced on September 8. The gesture, coming at a time of heated price negotiations in the upstream, may break the stability of wafer prices that has lasted for months.

Longi’s pricings remain unchanged. Some Tier-2 and Tier-3 manufacturers adjust pricings this week and may rearrange terms of business collaboration agreements to improve the circulation of wafers on the market in the face of increasing sales pressures.

Mono-Si wafer production volume sustained an 8-10% growth in October, the biggest month-on-month increase this year. For now, the ingot segment keeps steady utilization rates and sees profits recover rapidly, thanks to the mass amount of orders from the cell sector. Demand for mono-Si wafers persists. However, manufacturers, facing no inventory pressure, even negative inventory before, will begin to see increasing inventory pressures and unhealthy inventory turnover at the end of the year, if they continue raising utilization rates.
 

Cell

Inventory draw for cells is strong, as module makers ship actively to secure market shares in the fourth quarter, a typical high season in China. Manufacturers mostly sealed long-term orders. As a result, only few cells are available on the market. M10 cells see prices advancing further and are traded at RMB 1.35-1.36/W, some even at RMB 1.37/W.

This week, prices for M6, M10, and G12 cells come in at RMB 1.31/W, RMB 1.34-1.36/W, and RMB 1.34-1.35/W, respectively. Trading prices reflect current demand for cells in each format. M6 cells, like G1, see steady price trend as both supply and demand shrink. M10 supply, subject to inventory draws from the module sector, seems to run short despite wafer price declines. G12 supply strike a tight balance, for there are only a few suppliers, among which, the big ones cut external sales volume.

Cell prices will stay elevated in November. Declines are likely to occur in December, when global markets cut purchases as Chinese module makers hit their target purchase volume of the year, whilst frozen soils and holidays welcome markets outside of China.

Still, as the Lunar New Year holiday this time is earlier than usual, module makers may stockpile in advance, affecting cell price trend.
 

Module

Module prices stabilize in November. For glass-glass modules rated beyond 500 W, prices sustain at RMB 1.95-2.05/W, with RMB 0.01-0.03/W of price differences with glass-backsheet ones. Some module makers raise price quotes marginally by RMB 0.02-0.03/W to RMB 1.99-2.07/W, as cost pressures loom.  Still, end user acceptance is limited. For utility-scale projects, most orders are delivered at RMB 1.9-1.95/W. Overall, price range widens in the fourth quarter. Buyers mostly sign long-term orders for next year to mitigate loss from price fluctuations. In China, orders are mostly delivered at a fixed price throughout the contract period. Recent tenders will be carried out the same way.

The top five module makers keep high utilization rates in November, with some scheduling 5 GW of production per month. Overall, there will be 35-37 GW of module production output in November, a slight increase from a month earlier.

Glass prices rise marginally, coming in at RMB 28/m2 for those with 3.2mm of thickness, and RMB 21/m2 for 2.0mm ones. As of this week, some orders previously signed are delivered in the low-price range.

Prices for EVA films are little changed, sitting at RMB 13.5-14/m2 for 480-g high-transparency EVA films, and RMB 14-14.5/m2 for white EVA films.

In overseas markets, average module prices stabilize at USD 0.25-0.265/W.  Module prices (FOB) sit at USD 0.25-0.28/W in Europe, USD 0.245-0.255/W in the Asia Pacific region, and USD 0.245-0.255/W in Brazil. Local module prices in India translate to around USD 0.32-0.36/W (FOB). In the U.S., prices (DDP) come in at USD 0.41-0.44/W for Southeast Asian modules, and USD 0.5-0.6/W (DDP) for locally made modules.
 

N-type cell and module

This week, prices remain at last week’s level. The market has yet to see many price quotes for n-type products. We will decide whether to post the spot price of G12 HJT products or not based on mass production activities of all manufacturers.

Sales of n-type cells are mainly purchased for in-house capacities, and only few are external sales. Prices sustain at RMB 1.45-1.6/W for M6 HJT cells and sit at RMB 1.41-1.45/W for M10 and G12 TOPCon cells.

Module prices come in at RMB 2.1-2.2/W and USD 0.28-0.3/W in overseas markets for M6 HJT modules; RMB 2.2-2.4/W for G12 HJT modules; RMB 2.03-2.1/W and USD 0.27-0.28/W in overseas markets for M10 and G12 TOPCon modules.