Module prices drop again as cells keep falling under pressures

Polysilicon

Currently, polysilicon supply on the spot market remains relatively tight. As a result, prices sustain marginal increases and reach RMB 83-92/kg. Factoring in prices of all manufacturers, average prices rise to RMB 85/kg, a starkly different price trend from that of modules. 

The price trend in upstream sectors, especially in the polysilicon sector, is poles apart from the continuing price drops in the cell and module sectors. As previous orders are gradually delivered, polysilicon costs for ingot production will reach the peak of recent fluctuations in mid-October. For now, polysilicon costs vary among ingot manufacturers, coming in lower than RMB 72/kg for some while rising to RMB 80/kg for others.

Incidents that occurred at some manufacturers’ plants in Inner Mongolia disrupted supply and order deliveries in the later part of September. Recoveries and the increase in output next month require further observation. The supply-demand mismatch and price hikes in the upstream are juxtaposed with downstream price drops. After taking a downward turn last week, cell prices keep dipping this week upon pressures, which will gradually ripple to upstream sectors. Still, supply-demand relationship is not likely to balance in September, and future development after the National Day holiday is still unclear.
 

Wafer

Caught between ceaseless polysilicon price declines and plunging cell prices, the wafer sector sees inventory levels rising to equal five to seven days of production. To some manufacturers, G12 wafers account for larger shares of inventories. There is a clear disparity in short-term price trends among manufacturers. Despite a pessimistic outlook considering the current supply-demand relationship, polysilicon price hikes will underpin wafer prices.

This week, trading prices for p-type 210mm wafers fall, while the rest stay at last week’s level, sitting at RMB 3.33-3.35/piece for p-type M10 wafers and RMB 4.18-4.2/piece for G12 ones. For n-type wafers, prices come in at RMB 3.45-3.47/piece for M10 wafers. Given that G12 wafers are made-to-order products, their prices stabilize at RMB 4.47/piece.

Negotiations between wafer and cell sectors continue, being more intense for G12 wafers, for which prices are likely to dip further next week. Wafer manufacturers keep delivering to ensure stable prices. However, the combination of rising polysilicon prices and falling cell prices, as well as stockpiling demand before the National Day holiday, will affect future price trends. 
 

Cell

As cell manufacturers commission TOPCon capacities, low-efficiency cells and testing cells are flooding the market. Cell trading prices keep dropping, vicariously lowering prices for mainstream cells. As pressures from the module sector ripple to cell manufacturers, cell prices collapse this week, undermining prices across the supply chain. 

Trading prices slump this week, except for that of G12 cells, which sustain due to fewer suppliers and smaller production capacity. For p-type G12 cells, trading prices sit at RMB 0.73/W for G12 ones. For M10 ones, trading prices vary more greatly, coming in at RMB 0.66-0.7/W, with the low-price range dipping further.

For n-type cells, M10 TOPCon cell prices decline by 7-8% to RMB 0.73-0.76/W. N-type cell prices are RMB 0.04/W higher than p-type ones. G12 HJT cells, mostly for in-house use and less for external sales, see prices remaining at RMB 0.85/W.

Price trends of each sector vary greatly. The cell price plunge partially soothes pressures for module makers to cut prices and improve their profit margins. However, it may prompt further declines in wafer and module prices. Cell prices could still go down as manufacturers deliver new orders at new prices. Future price trend hinges on inventory depletion of cell manufacturers and the rise of end-user demand. 
 

Module

This week, the previously simmering rising momentum for module prices weakens, due to oversupply, lackluster demand, and cell price slumps. Delivering prices for glass-backsheet modules drop to RMB 1.2-1.22/W. Tier-1 module makers accept lower prices to secure orders, taking orders at RMB 1.18-1.2/W. Tier-2 and Tier-3 manufacturers keep price quotes unchanged out of cost concerns at RMB 1.2-1.21/W for glass-backsheet modules, with the low-price range purportedly reaching RMB 1.15-1.16/W. Production plans during September and October will decline due to production cuts in the latter part of September and the impact of the National Day holiday. 

In non-China markets, prices are affected too. Chinese exporters deliver products at USD 0.14-0.155/W (FOB). In Asia-Pacific, module makers deliver at USD 0.14-0.15/W. In India, prices for local modules come in at USD 0.25/W. In Europe, spot prices come in at EUR 0.14-0.15/W, with modules with black backsheets possessing a premium of EUR 0.02-0.025/W. With orders signed prior to deliveries, modules for ground-mounted projects in the U.S. see prices hold steady at USD 0.38-0.4/W (DDP). For distributed generation projects, module prices are subject to market demand and thus more volatile. Presently, the price disparity between the two is rather huge, sitting at USD 0.3-0.4/W (DDP).

Demand and price swings across the supply chain affect n-type module prices. For TOPCon modules, prices fall to RMB 1.21-1.35/W, and the price difference narrows to RMB 0.05-0.08/W. In non-China markets. TOPCon modules possess a premium of USD 0.008-0.01/W against PERC ones.

For HJT modules, prices are little changed, sitting at RMB 1.4-1.55/W in China, RMB 1.4/W for spot inventory and RMB 1.36-1.38/W for low-efficiency modules. In non-China markets, HJT module prices stabilize at USD 0.195-0.2/W.