Price upward trend continues for polysilicon; cell prices set to rise after the Lunar New Year
February 3, 2021 PV InfoLink
With the Lunar New Year holiday just a week away, manufacturers in the up and downstream have signed orders for February. Therefore, prices for mono-grade polysilicon continue to rise this week, having risen by RMB 1/kg from last week. The market prices came in at RMB 87-91/kg and averaged RMB 88/kg. The market reported shortage of polysilicon recently, with some manufacturers failing to fulfil orders in January. So, ingot pulling labs are urging polysilicon manufacturers to deliver orders before the holiday begins.
Since the beginning of the year, downstream manufacturers have been busy stocking up and grabbing polysilicon. Meanwhile, most polysilicon producers have little left to offer, while buyers are eager to buy more even the prices are on the rise. As a result, polysilicon prices remain high. Overall, mono-grade polysilicon has mostly been booked by customers. With no extra stock to sell, prices for mono-grade polysilicon are expected to stay at a high level after the Lunar New Year holiday.
Demand for multi-grade polysilicon remains sluggish. In the face of growing market share of mono-Si products, multi-Si wafer makers continue to cut production. This week, the average prices for multi-grade polysilicon rose by RMB 1/kg in China. The market prices came in at RMB 53-56/kg and averaged RMB 55/kg.
Tier-1 manufacturers across the supply chain have signed orders with overseas customers and they will deliver orders after the Lunar New Year. Mono-grade polysilicon prices hold ground amid an anticipation of price increases. This week, the market prices for mono-grade polysilicon rose slightly to USD 10.9-11.2/kg, while prices for multi-grade polysilicon came in at USD 6.6-7/kg.
Several factors, including high mono-grade polysilicon prices, strong demand for mono-Si wafers, less-than-expected commissioned new mono-Si wafer capacity, and low inventory held by mono-Si wafer manufacturers, have contributed to Longi’s consistent prices over January to February. One of the Tier-1 manufacturers stop offering discounts. Other manufacturers also keep their prices unchanged. This week the trading prices for mono-Si wafers stayed high, sitting at RMB 3.11-3.14/piece and RMB 3.2-3.24/piece for G1 and M6 wafers, respectively. In overseas markets, G1 and M6 wafers were traded at USD 0.425-0.427/piece and USD 0.438-0.441/piece. M10 and G12 wafers were respectively traded at RMB 3.85-3.9/piece and RMB 5.45-5.48/piece. Since February is the shortest month of the year and the supply of polysilicon is running short, mono-Si wafer manufacturers are expected to lower utilization rates, which may lead to shortage of different sized wafers.
The high-priced multi-Si wafers rose slightly this week, whereas prices in other range stay unchanged. The market prices in both China and non-China markets came in at RMB 1.15-1.53/piece and USD 0.162-0.208/piece, respectively. Since multi-Si wafer makers will cut or cease production during the Lunar New Year holiday, the supply of multi-Si wafers will dwindle further. If end-user demand for multi-Si products remains weak, some multi-Si wafer makers are likely to withdraw the business.
The downward trend in cell prices slowed this week, with the average prices staying constant. As the Lunar New Year holiday looms, trading volumes decreased slightly this week. Moreover, cell manufacturers attempt to raise prices due to wafer shortage and rising material costs, especially silver price increases amid investor frenzy, which cause silver paste costs to rise by around RMB 0.01/W. As large cell manufacturers will remain in operation during the Lunar New Year holiday, Tier-2 and Tier-3 cell makers will be the first to be hit by wafer shortage.
Considering the current situation of supply and demand, cell price trend will stabilize after the Lunar New Year. Whether cell prices will increase is subject to market situation. For now, prices are predicted to fall in late March.
The market prices of G1 cells ranged from RMB 0.88-0.91/W, while that in the high price range tumbled slightly. Overall, prices still remain in a high level due to strong demand ahead of the Lunar New Year.
M6 cell prices stay constant now, with the market prices ranging from RMB 0.80-0.88/W and averaging RMB 0.84-0.85/W. M6 cell prices decreased marginally in overseas markets due to exchange rate fluctuations and slower penetration of price decrease.
Since large cells are still in the early phase of development, it’s not easy to acquire large wafers. Most cell makers thus reply on OEM and dual distribution model for their large cell business; overall prices stay relatively stable. This week, the average prices for M10 and G12 cells remain stable at RMB 0.89-0.9/W and RMB 0.9-0.91/W, respectively.
The supply of multi-Si cells continues to shrink, while demand rises slightly due to customers’ stocking up ahead of the Lunar New Year and India’s fiscal new year. So, prices rose marginally to RMB 2.45-2.55/piece.
Although prices of cells and some module bill of materials declined this month, overall costs for modules remain high. With order volumes staying high but module profits staying low recently, module makers’ quotes remain high in the first quarter. Large module makers will also stay open during the holiday. Some manufacturers will not adjust utilization rates to keep staff on-site during the holiday. Module prices are expected to decline each quarter along with capacity expansion of modules and glass.
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News & Analysis
Polysilicon prices rise as buyers stock up ahead of Lunar New Year
With no polysilicon left for sale, demand likely to remain strong until the Lunar New Year.
Price gap of M6 cells widen between Tier-1 and Tier-2 manufacturers
The trading price for M6 cells has plunged by RMB 0.03–0.07/W to RMB 0.84–0.93/W. The price gap between Tier-1 and Tier-2 producers has therefore widened again.
Cell prices sustain less decrease, but set to resume a downward trend after Lunar New Year
Overall, cell prices will continue to decline after the Lunar New Year.
Large format module prices reaching 166mm level amid active promotional campaigns
Manufacturers are actively advocating M10 and G12 cells, bringing down the average prices of M10 cells to RMB 0.9-0.92/W and G12 cells to RMB 0.93/W this week.
New orders yet to be settled as negotiations continue
Production capacities of most polysilicon manufacturers have all been booked previously. This week, the market only saw a few rush orders and sporadic orders, with the latter being signed at prices approaching to RMB 215/kg.
Price hikes did not continue indefinitely; awaiting new round of negotiations
With no inventory left for manufacturers to sell, significant price fluctuations will only emerge at the end of the month. However, a few wafer manufacturers were reportedly poised to raise prices again, amid vigorous demand. Whether wafer prices can rise
Price hikes continue across supply chain amid polysilicon and wafer shortages
Polysilicon production capacities are fully booked for September, as utilization rates of the two wafer supermajors markedly increased, driving up demand for polysilicon. Market prices rose accordingly from last week’s RMB 203-207/kg to RMB 205-210/kg.