EnergyTrend: Benefitting from Inventory Restocking Orders, Post-Chinese New Year Solar Supply Chain Price Increase Brewing

published: 2012-01-19 17:05 | editor: | category: Price Trend

As Germany’s installation volume for 4Q was unexpectedly high, inventory levels were adjusted significantly – some system makers’ stock levels had even fallen to recent lows. Meanwhile, affected by the uncertainty of Germany’s policies, demand momentum for 1Q12 may be similar to that of 4Q11. According to EnergyTrend, a research division of TrendForce, although European system manufacturers have already begun to place orders, their main priority is still inventory restocking. Since related manufacturers have been continuously receiving European system vendor orders, and previously placed North American orders are currently being shipped, polysilicon and silicon wafer demands are increasing simultaneously. 

On the other hand, although Taiwanese solar cell makers’ shipment volume has increased, price has not followed suit. EnergyTrend research indicates, recently solar cell orders have mostly been urgent orders placed by Chinese module makers. While order volume is large, in order to be compatible with module manufacturing process, China makers’ own patterns must be used. Additionally, as most orders consist mainly of standard products (16.4%-16.8%), price remains low and these orders do not significantly benefit solar cell makers’ profitability. The main advantage to accepting these orders is the increase in capacity utilization rate.

Furthermore, Chinese manufacturers previously cut capacity, which reduced supply volume. Now, as urgent orders flood in, supply still seems tight, which has caused the slight increase in standard product prices.

As for modules, this week’s module price stayed flat. Related vendors indicate that if upstream prices continue to rise, makers will have to transfer cost to the client end – whether or not they will be successful depends on the future development of the market.

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