World leading manufacturer of multi-si wafers GCL-Poly reported lower price after SNEC 2016 tradeshow taking place in Shanghai, China in late May, driving multi-si wafers’ price to drop by US$0.02 per piece in June. Consequently, spot prices among every sector in PV supply chain will face significant price downturn.
Besides, rumor had it that China might postpone the grid-connection due date from June 30 to August 31, while it is now widely believed by Chinese PV makers as a rumor. As a result, EnergyTrend expects that the overall PV demand will immediately cool down after the peak demand from PV projects to be grid-connected by June 30.
Polysilicon’s price has already peaked. Although the price will start to decrease, the downward trend will be moderate because of current’s strong demand and full utilization rates. In early June, polysilicon’s prices will fluctuate between RMB 145~148 per kg.
Price of China-made or China-traded multi-si wafers decreased to RMB 6 to 6.2 per piece during this week, which again widened the price gap between multi-si and mono-si wafers. Earlier this year, the price gap between multi-si and mono-si wafers was not large enough for multi-si PV products to maintain its market share. To fight against mono-si wafers’ competitive price, GCL-Poly reported lower quotes for multi-si wafers and help reduce the average spot price in the Chinese market. In the meantime, Taiwanese multi-si wafers’ price dropped to US$0.835 per piece from US$0.85~0.855 per piece in May. As the PV demand will go weak starting from late June, the prices will simultaneously decrease.
As for PV cells’ price, weakening demand forced module manufacturers to increase their module inventory, so PV cell makers had to sell their products at lower prices even there was almost no room for price reduction. In Taiwan, PV cells’ price has dropped to around US$0.293~0.298 per watt. Adding that PV cell vendors procured wafers at relatively high prices, the gross profit of PV cells transacted across the strait has decreased to near zero.
Furthermore, prices of PV cells manufactured in third-party countries were also reduced. China’s first-tier PV manufacturers such as Trina Solar, JinkoSolar and JA Sola have been gradually commencing commercial operations of their overseas manufacturing facilities and reducing cell procurement from other makers’ plant in third-party countries. PV cells made in regions/countries outside of China and Taiwan will not always be the best choice, so the PV cells’ price manufactured in these places dropped below US$0.37 per watt.
China’s PV demand in the third quarter is likely to freeze because, according to EnergyTrend’s forecast, PV capacities to be grid-connected in the second half of 2016 may only represent 50% of or less than the capacities grid-connected in the first half of the year. It is unlikely for the Chinese government to postpone the grid-connection due date to August 31, neither. As PV module makers are mostly pessimistic to market demand in the third quarter, some PV modules were traded under prices at RMB 3.5 per watt or US$0.46 per watt.
Moreover, the high inventory level of PV modules drove price decrease of modules made overseas. Some module makers were said to reduce their utilization rates. In the third quarter, India might be the only market that will sustain a strong demand. EnergyTrend therefore expects a downward trend of spot prices in the whole PV value chain in the upcoming quarter.