It was a bumpy year for the PV industry in 2021. While experiencing polysilicon price surge, China’s energy intensity control, and dramatic supply chain prices fluctuation, global installed capacity posted stellar performance. InfoLink estimates the world to have added 172.6 GW of installed PV capacity in 2021, a 23.1% YoY increase. Installed capacity outside of China came in at 124.6 GW, a 30.1% YoY increase. The rapidly growing demand overseas bolstered the export of Chinese modules. According to data compiled by InfoLink, China exported 88.8 GW of modules in 2021, a 35.3% increase that is chiefly attributed to major PV markets, such as Europe, Brazil, and India.
China module export outlook
The chart shows China exporting more modules to the world in 2021 than in 2020. In addition to the clear demand for energy transition in developed markets, such as Europe and the U.S., other developing countries introduced incentive policies for the PV industry as well. Investigation of PV industry found Greece, Israel, and Turkey becoming GW-scale markets in 2021, putting the total amount at 19 countries, indicating increasing PV demand overseas. It’s worth noting that Vietnam imported 6.4 GW of modules from China in 2020, and thus became the second biggest Chinese module importer. However, with no replacing policy when the subsidy ended, the country saw import volume rapidly decline, sitting at merely 0.4 GW.
The second half of a year is typically the high season in the market. But in the second half of 2021, China exported fewer modules. This can be attributed to production bottleneck in the upstream that pushed up supply chain prices, China’s energy consumption control that elevated module prices, and rising freight rates that pressured module makers. Considering profitability, end users put off deliveries or re-negotiated prices.
Europe and Asia remained the biggest markets for modules exported from China, aggregately securing 70% of share. The figure marginally declined from that in 2020, with Europe taking up 46%, while Asia accounting for 25%. Meanwhile, other emerging markets, such as Latin America and the Middle East, saw their shares of import volumes slightly increase.
The European market imported 40.9 GW of modules from China in 2021, a 54% increase, compared to 26.7 GW in the preceding year. Owing to energy transition, Europe has been the largest module importer, accounting for 46% of the global total, with the Netherland, Spain, Greece, Portugal, Poland, and Germany having GW-level import volumes. The Netherlands, with 23.8 GW of annual import volume, is the biggest import country for Chinese modules. However, subject to the court’s decision on the patent dispute in November 2021, some relevant products cannot be sold, of which import volumes accordingly declined.
Asian markets saw import volumes marginally drop from 23.3 GW to 22.4 GW, with its share shrinking to 25% in 2021, but was still the second-largest market for Chinese modules. GW-scale importers include India, Japan, Australia, and Thailand, while South Korea and Malaysia each imported nearly 1 GW of modules. In Asia, Vietnam bought the most modules from China in 2020. However, as subsidies ended, the country saw import volume rapidly decline, sitting at merely 0.4 GW.
Latin America, the Middle East, and Africa
Latin America, the Middle East, and Africa each bought 16.6 GW, 6.4 GW, and 2.5 GW of modules from China in 2021, with their share combined reaching 29%, and respectively increased by 66%, 60%, and 49% YoY. The growths were evident, due to lower levels in 2020. GW-scale import countries include Brazil, Chile, Mexico, Pakistan, Israel, and South Africa. Brazil was the second-largest market for Chinese modules, importing 11.3 GW in 2021.
With the shared goal of cutting emissions, countries around the globe set net-zero targets and thus stimulating PV demand. InfoLink puts its forecast for 2022 global demand at 214 GW, and at 139 GW for markets outside of China, an 11.6% YoY increase. The growth is not as rapid as last year, but still bullish news for Chinese modules. Still, international situation is to be heeded, which poses variables to the supply-demand relationship in the PV industry, such as India’s imposition of the 40% BCD from April onward and countries’ construction of local production capacity to ensure the stability of supply chain.