Aside from polysilicon that sees stronger prices, prices in all segment of PV supply chain have weakened. The industry will cool down after June 30th, where grid-connection will mostly be completed by then. Demand is expected to decrease, resulting in lower overall prices in July and August.
Polysilicon Smuggling Investigation Emerges, Boosting Polysilicon Prices
In early-April, the Chinese government suddenly started to investigate thoroughly polysilicon material sources that circumvented China's anti-dumping and countervailing duties and smuggled to the Chinese market. This move worsened the availability of spot products for polysilicon in China. As a result, mainland China's polysilicon's price surpassed 145RMB/kg and the orders of June were undergoing negotiation.
Therefore, although downstream prices of multi-si wafer and PV cells started to drop, polysilicon’s price trend will maintain a slow growth until May and may even exceed RMB 150/kg. Polysilicon material sources also reduced significantly in non-Chinese regions as OCI, a manufacturers that is little affected by the anti-dumping and countervailing duties, continuously ships polysilicon to China, leading to higher prices.
But EnergyTrend believes that the rising polysilicon prices will cause second-tier ingot makers to lower the production. If manufacturers keep on reducing the production, it will not be good to polysilicon sales. Hence, price growth should slow down after it reaches RMB 150/kg, so wafer manufacturers could have some time to rest.
Up and Downstream Prices Continue to be in a See-saw Relationship
Chinese and Taiwanese wafer manufacturers have completed negotiating for wafer prices in May, yet GCL’s prices only slightly declined, and thus the decline in wafer prices was not in cell maker’s expectation. Chinese multi-Si wafer was priced at RMB 6.2-6.3/pc, while Taiwanese multi-Si wafer reached US$ 0.85-0.86/pc. Because cell makers could barely make any profits with this price, wafer prices will reflect a downtrend as cell prices weakens.
Some cell orders was closed at a price below US$ 0.3/W, but some cell makers still weren’t willing to give in. Therefore, they started to stabilize the price through asking if their buyers are willing to increase high-efficiency cell production to slow down the decline in prices.
Due to strong demand from downstream sectors, many module makers have placed orders with mono-Si wafer and cell makers, leading to stable prices. Mono-Si prices can stay flat until multi-Si wafer and cell prices drop significantly again.
Module prices were requested to be lowered by power plant manufacturers as cell prices declined too fast. Module prices will continue to reflect a downtrend because manufacturers will begin to negotiate 2H16 orders after June 30th and there will be no need to rush connecting to the grid.