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| Author | InfoLink |
| Updated | July 05, 2023 |
Polysilicon
As of early July, the depletion of polysilicon inventory on the spot market speeds up significantly. The intensities of inventory pressures on Tier-1 and Tier-2, 3 manufacturers are different, as Tier-1 manufacturers digest faster than expected, while the rest are still stuck with the unsold products. The efficient decrease in Tier-1’s inventory is a direct result of price cuts and sales, where they offer cheaper, better-quality polysilicon for n-type ingot production, boosting order volume and clearing inventory. As noted last week, manufacturers are split on “whether or not” and “when” they should stockpile and buy the dip. Some buyers, who have new capacities and need more polysilicon for production, place bulk orders to buy at even lower prices.
Mono-grade polysilicon prices stay at RMB 59-64/kg this week, showing little momentum for further declines. Spot prices of both Tier-1 and Tier-2, Tier-3 manufacturers stop falling, with the gap between the two narrowing noticeably. Most polysilicon manufacturers struggle to sustain profit at the current price level. Rapid price drops in the second quarter prompt new entrants to reconsider commissioning in terms of earnings and losses.
Increases in production volume in July are little changed from June’s level, as manufacturers release new capacities and need more time to run at full capacity. Meantime, power rationing and production restrictions affect production output in some areas. As of this month, new capacities offset those suspended and retired.
Wafer
As upstream prices correct, wafer prices can hardly decline further. Manufacturers adjust pricing strategies incessantly in accordance with their inventory levels.
Trading prices for M10 and G12 wafers slip to RMB 2.7-2.8/piece for M10 wafers and RMB 3.7-4/piece for G12 ones. The highest trading price this week is close to the average price a week ago. Price declines slow down significantly, coming to a gradual end. M10 wafers have a better price-performance ratio per watt. G12 wafers see trading prices vary, with Tier-1 manufacturers trading at RMB 3.95-4/piece, and Tier-2 at RMB 3.7-3.8/piece.
Early this month, manufacturers increase production plans, but inventory levels remain, thanks to active purchases from the cell sector. Given that, some wafer manufacturers want to raise prices. However, with wafer production output rising every month, inventory pressure lingers. There is little rising momentum for wafer prices, which will stabilize at the current level next week.
Cell
PERC cell supply is steady. Most expansion projects this year are n-type cell production capacities. Despite still uncertain end-user demand, purchases for M10 PERC cells are active as the module sector brings more capacities online.
As mentioned last week, cell manufacturers raise price quotes recently. Trading prices rebound marginally, coming in at RMB 0.7-0.71/W for M10 cells and RMB 0.72/W for G12 ones. The average price for M10 cells increased by RMB 0.01/W.
For M10 TOPCon cells, prices stabilize at RMB 0.78/W. N-type cell prices sustain RMB 0.07-0.08/W higher than p-type ones. Also affected by wafer price declines, the few suppliers of G12 HJT cells see prices drop to RMB 1/W.
Even with the rise in trading prices for M10 PERC cells, the current price level is still shy of manufacturers’ expectations. Many still trades at RMB 0.7/W. Given the unsatisfactory module order volume, cell manufacturers will continue feeling pressure from the module sector against cell price hikes.
Module
Fewer but still some module makers are clearing inventory this week, compared with June, especially non-China makers, of whom inventory levels remain high. This week, prices reflect order activities, with Tier-1 module makers taking orders for PERC glass-backsheet at RMB 1.35-1.38/W, and their Tier-2 and Tier-3 peers at RMB 1.28-1.3/W. TOPCon and HJT modules are traded at RMB 1.4-1.5/W and RMB 1.6-1.7/W, respectively. Factoring out selloffs, new orders of small module makers and inventory-clearance sales see the low-price range sitting at RMB 1.25-1.3/W, and the high-price range at RMB 1.4-1.5/W.
Some end users keep the wait-and-see attitude, delaying deliveries of some new orders in July. Future developments hinge on supply chain price trends. Tier-1 module makers are poised to increase production, but the overall production plan this month remains obscure and is estimated at 45-47 GW for the time being. Tier-1 module makers hope for a steady price trend, but their Tier-2 and Tier-3 peers offer price quotes aggressively, purportedly at RMB 1.2/W for the fourth quarter. Module makers have little profit margin at the current price level of RMB 1.3-1.4/W. In the future, prices will stay on a slow decline, lingering at RMB 1.2-1.35/W in the long run. Demand and the impact of power rationing are to be heeded in the third quarter. Brief rallies are possible.
In non-China markets, prices drop marginally this week. Chinese exporters deliver products at USD 0.17-0.19/W (FOB). Spot prices come in at USD 0.17-0.185/W in the Asia-Pacific market and USD 0.17-0.18/W in Europe, with modules with black backsheet possessing a premium of EUR 0.02-0.025/W.
For locally manufactured modules, prices stabilize for now. In the U.S., prices sustain, but distribution prices of Tier-2 and Tier-3 module makers drag down the low-price range. India-made modules see the highest price point (prices for modules composed of India-made cells) slip due to lower production costs. For Indian modules comprising China-origin cells, prices hold steady temporarily but may fluctuate afterward as cell prices rebound.
Module makers recently deliver G12 HJT modules at RMB 1.6-1.72/W in China and USD 0.205-0.235/W in non-China markets.
M10 TOPCon module prices remain at RMB 1.4-1.57/W this week. In non-China markets, prices hold steady at USD 0.185-0.22/W, with a premium of USD 0.005-0.01/W against prices for PERC modules.