Polysilicon prices finally reach tipping point

Polysilicon

Staying elevated for months, polysilicon prices finally step on a distinctive downward trip this week.

Tier-1 manufacturers will start negotiating and sealing new orders next week, but many are still delivering orders previously signed orders this week. However, the range of prices of Tier-2 manufacturers keeps widening. Anticipation of price decline is at its peak. From the end of this month to early next month, as the market starts placing new orders, mainstream prices will drop more markedly and even faster next week.

An unhealthy inventory will persist in the polysilicon sector until the end of the month. Polysilicon inventory can hardly build up at the year’s end, as polysilicon production volume increases, and downstream demand wanes next month. This will be the first downward movement of polysilicon inventory over recent two years. 

* 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

Prices for mono-SI wafers keep fluctuating significantly. Tier-1 wafer manufacturers leave official pricings unchanged but have made several strategic adjustments during order deliveries.  Tier-2 and Tier-3 wafer manufacturers cut sales prices more aggressively to boost shipment. 

Mono-Si wafer inventory builds up. The cell sector cannot deplete more _ with its effective production capacities. As end user demand slows, mono-Si wafer manufacturers will find it more difficult to ship. 

Whether the pace of price decline will affect the ingot segment’s utilization rates in December requires further observation. Even if utilization rates remain, there will be almost 40 GW of monthly supply, which is still quite high, compared with ingot consumption of downstream sectors.

As sales pressures increase at the end of the year, wafer manufacturers may rearrange terms of business collaboration agreements to improve the circulation of wafers on the market. 
 

Cell

Cell trading prices were little changed after price hikes earlier this month, sitting at RMB 1.31/W, RMB 1.35-1.36/W, and RMB 1.34-1.35/W, for M6, M10, and G12 cells, respectively. 

Recent price trend signals the end of cell price hikes. Future declines are definite. Temporarily decoupled from upstream prices, cell prices become closely connected with demand from the module sector. This week, as polysilicon, wafer, and module prices drop in concert, it is even less possible for cell prices to sustain at current level. Next week, mainstream trading prices will sustain, but both high-price range and low-price range will slip. In mid-December, cell prices will decline further, directing prices across the supply chain to a downward path. 
 

Module

Module prices begin to swing this week. More long-term orders are sealed at RMB 1.9/W. Some Tier-1 module makers fail to raise price quotes, and some even cut prices. The average price range declines marginally this week, coming in at RMB 1.95-1.97/W for glass-backsheet modules rated beyond 500 W, and RMB 1.97-1.99/W for glass-glass ones. Prices are mixed, with distributed and utility-scale projects seeing indistinct price differences. Overall price range will continue expanding in the fourth quarter. 

Trading activities have been decreasing markedly since last week. As winter nears, some projects are slowed down, even halted in Northern China, while the south still sees active installations. In some regions, end users are stalled by module prices and the expiration of the 2017 land usage policy. 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, deepening the cautiousness of end users.

This week, 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 0.24-0.275/W. Module prices (FOB) fall marginally to USD 0.24-0.265/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. 

Next year, the emergence of new players will intensify competition in the module sector worldwide. Some module makers offered price quotes as low as RMB 1.75-1.78/W and USD 0.23/W in the first half of the year. Such disarray 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 come in between RMB 1.45/W and RMB 1.65/W for G12 HJT cells. There are less M6 HJT cells on the market as manufacturers modify production lines.  For M10 and G12 TOPCon cells, prices come in at RMB 1.41-1.45.

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.