Markets are cautious ahead of price tipping point

Polysilicon

Polysilicon manufacturers focus on delivering previous orders as of the middle of the month. With divergent attitudes, buyers complete orders to fulfill inelastic demand and wait for possible price declines otherwise.

As of this Wednesday, prices for mono-grade polysilicon have yet to see significant declines, sitting at RMB 303/kg. Price quotes from different manufacturers are increasingly varied, with Tier-2 companies being poised to set prices lower. The role buyers play in the market gradually change as their attitude shift. Negotiations among upstream sectors intensify.

The ingot segment’s inelastic demand for polysilicon is more evident this month, with utilization rates rising steadily. A tipping point of supply-demand relationship in the upstream will occur by the end of the year. Polysilicon will not see prices drop significantly in the short term, but declines are more and more likely. 

* 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

The low-price range keeps falling for mono-Si wafers. Pricings of leading manufacturers are unchanged, but for Tier-2 manufacturers’ 182mm wafers, prices drop to RMB 7.35/W on the spot market. Factoring in price variation among wafers with different thicknesses, prices have dropped to RMB 7.25/W for some 182mm wafers with a thickness of 150µm.

Overall, there is more supply on the market in November. The cell sector has managed to keep utilization rates at their max and will not be able to take more wafers. As a result, pressures are building for mono-Si wafers in all formats, of which inventories rise to an unhealthy level. 

Much more downgraded wafers are available on the market. Prices drop faster for non-a-grade wafers, which may continue to see sluggish sales, as supply-demand relationship changes, whilst wafer manufacturers set higher standards on product efficiency and quality. 
 

Cell

Cell trading prices stabilize this week as markets await new wafer pricings to be published next week. Prices come in at RMB 1.31/W, RMB 1.35-1.36/W, and RMB 1.34-1.35/W for M6, M10, and G12 cells. Prices in dollar terms rise on exchange rate fluctuations, pressuring module makers in overseas markets. 

Trading prices for M10 cells sustain with no sign of decline. Presently, due to supply bottleneck of large-format high-efficiency cells, cell prices decouple from upstream price trend and become closely connected with demand from the module sector. 

Cell prices have reached a tipping point. Still, it is relatively hard to pinpoint the exact timing of the downward trend, considering all the variables. Prices may drop due to waning demand if module makers hit the target purchase volume by December, and anticipation of price declines. It is also likely that prices plateau until early next year if module makers start stockpiling for the Lunar New Year sooner than before. For now, the Covid-19 pandemic intensifies in China, forcing the SNEC exhibit to be postponed for another year. A Covid resurgence will disrupt production and logistics. Buyers may stockpile in advance, shoring up cell prices. 
 

Module

Price quotes rise by RMB 0.02-0.03/W to RMB 1.99-2.07 in November. Still, end user acceptance is limited. For utility-scale projects, most orders are delivered at RMB 1.9-1.95/W. The price gap between orders of distributed and utility-scale projects narrows. Prices are mixed. Overall price range will continue expanding in the fourth quarter. Glass-backsheet modules see RMB 0.01-0.03/W of price differences with glass-glass ones.

Trading activities markedly decrease this week. As winter nears, some projects are slowed down, even halted in Northern China, while the south still sees active installations. The market sentiment seems inconsistent in China. This year, installation schedules are vague. Developers initiate projects at leisure, despite the installation deadline. Recent rumors suggest that module prices should drop at the deadline early next year. 

Price trend looks clearer in China, based on price quotes for next year. 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.

Overseas markets are still disordered, mainly because of sluggish demand in the fourth quarter and serious project inertia. For now, prices purportedly come in at USD 0.24-0.28/W. Module prices (FOB) fall marginally to USD 0.24-0.27/W in Europe, USD 0.24-0.25/W in the Asia Pacific region, and USD 0.24-0.25/W in Brazil. Local module prices in India translate to around USD 0.32-0.359/W (FOB). In the U.S., prices (DDP) come in at USD 0.41-0.44/W for Southeast Asian modules and USD 0.5-0.58/W (DDP) for locally made modules. 

Overseas markets will be more chaotic than the Chinese market next year. This is largely attributed to the emergence of new players that intensifies competition in the module sector. Some module makers offered price quotes as low as USD 0.23/W in the first half of the year, even USD 0.22/W in the second half. Such a condition will persist into next year.
 

N-type cell and module

This week, prices remain at last week’s level. The market has yet to see mainstream prices for n-type products. Whether a new column for price quotes will be added depends on the mass production activities of all manufacturers in Q4. 

Sales of n-type cells are mainly purchased for in-house capacities, and only few are external sales. Prices sustain at RMB 1.44-1.6/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 0.27-0.29/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 0.265-0.275/W in overseas markets for M10 and G12 TOPCon modules.