Polysilicon quotations remained sturdy on the weaker end this week, where partial businesses remained in a deadlock for price negotiation. Having entered July, although wafer businesses are constantly suppressing the prices during procurement, polysilicon businesses are maintaining previous quotations without easy compromises owing to the near absence of inventory and fund-related pressures, though high level quotations are now scarce in the market. Mono polysilicon is centralized at RMB 205-220/kg in mainstream quotations, and the quotations for multi polysilicon is mostly at RMB 80-125/kg due to the production decrement in the downstream sector and the suspended inflation of mono polysilicon. Polysilicon quotations are expected to remain stable amidst the periodic imbalance of supply and demand in the recent market.
An observation on the production, operation, and shipment status of the polysilicon sector indicates that 2 out of 11 businesses have yet to fully recover their capacity, and one has planned for a resumption in production recently. Looking ahead to the subsequent market, partial polysilicon businesses postponed overhaul in the first half of the year to guarantee market provision, and the supply of polysilicon will remain constrained from the fourth quarter to early 2022 due to the polysilicon sector entering the routine overhaul for production lines during the third quarter, and the wafer end that is supported by new capacity, as well as the installation demand for the end of the year.
The pressure in reduction gradually magnified for wafers this week, and the decrease of multi-Si wafer prices was particularly evident. Regarding mono-Si wafers, second and third-tier businesses have successively retraced the quotations after the price reduction announced by leading businesses, though cell businesses are adamant in adhering a wait-and-see attitude when purchasing wafers under a depletion in cell quotations, and the overall transaction volume has been small. G1 and M6 wafers are stabilized at RMB 4.96/pc and RMB 5.08/pc in average prices. Pertaining to large-sized wafers, the price difference between G12 and M10 wafers has now diminished after the price reduction in early July, and the enhanced product competitiveness has emitted an active signal of profit forfeiting to the downstream sector. M10 and G12 wafers are now sitting at respective quotation of RMB 5.87/pc and RMB 7.53/pc. With successive initiation in new wafer capacity from Gaojing, Hongyuan, JYT, and Shuangliang in late-June that will cause an overall increase in the supply of wafers starting from the third quarter, market competition will result in a certain extent of drop in wafer prices.
The transaction volume of multi-Si wafers has been constantly dropping owing to the fallen demand for downstream cells, and the underselling of multi-Si wafers has been seen from the market. Despite the overall market quotation of RMB 2-2.2/pc, the quotations of various businesses are relatively chaotic, and resources below RMB 2/pc are starting to pile up.
Cell quotations had simultaneously decreased this week, and multi-Si cells have plummeted for two consecutive weeks. In terms of mono-Si cells, the reduction in upstream wafer quotations and the price drop announced by leading cell businesses have yet to generate mass batches of concluded cell orders primarily owing to the relatively weaker bargaining power of cell businesses after the announcement of price reduction, and the fact that the downstream market requires a certain duration for digestion. Mono-Si G1 and M6 cells have now dropped to RMB 1.05/W and roughly RMB 1.04/W respectively, while mono-Si M10 and G12 cells have descended to approximately RMB 1.05/W. The downstream sector maintains its wait-and-see attitude, and is not willing to start mass procurement owing to the belief that current prices have yet to stabilize.
The tariff of India that will expire at the end of July has diminished the demand for multi-Si cells, and resulted in a contraction in the corresponding prices. Jettison has been seen in the multi-Si cell market due to the shrunken end demand and the relinquishing of upstream wafers, and quotations are now frantic.
Module quotations had slightly loosened this week, and a differentiation has emerged amongst market prices. The end market is holding onto a certain level of demand and module orders, though most orders are centralized on first-tier makers, who have decided to not adjust the quotations after taking into account cost and order support under the lowered cell quotations this week. Second and third-tier module makers, who are comparatively flexible, have implemented marginal adjustments based on the reduction in upstream cell prices, where G1 and M6 have respectively dropped to RMB 1.65/W and RMB 1.73/W, and the average price of multi-Si quotation has deteriorated to RMB 1.49/W, though the intensity of inventory pull from end projects remains insignificant. The PV glass market is gradually stabilizing, where the exercise price of the 3.2mm glass sits at RMB 21-23/㎡, while the 2.0mm PV glass is now RMB 17-20/㎡ that remains identical to that of last month. The surge in soda ash prices has invigorated a rise of cost in PV glass, and imposes inferior profits for glass businesses, where many of them have decided to switch to the capacity for 2.0mm. Despite mitigation in restrictions pertaining to production expansion, the lowered profitability has impeded multiple new suppliers from activating their kilns, while Xinyi Solar and Flat Group remain as the major businesses in expansion for the PV glass market.