Polysilicon
High-level polysilicon quotations were stabilized this week, where the basic prices of mono polysilicon had slightly risen. The mainstream quotation range has been diminished to RMB 205-277/kg, with the average price maintained at RMB 210/kg. Industry associations and competent authorities are recently participating in the coordination for this round of market operation in polysilicon, and are propagandizing rational management, the boycott of excessive hoarding of polysilicon and wafers as well as the low price dumping of cell and modules, which will shift the transactions of the polysilicon market towards rationality, without a continuous surge in polysilicon prices.
An observation on the production, operation, and shipment status of the polysilicon sector indicates that the 11 operating multi polysilicon businesses are primarily fulfilling previous orders, and 3 businesses are taking turns in overhaul, whereas 2 businesses are expected to gradually resume operation before the end of the month. In addition, the marginal mitigation in the power restriction of partial regions of production, and the unsurfaced supply pressure from non-Mongolia production, are contributing to the improved supply structure of polysilicon in June. In terms of demand, although downstream businesses in the industry chain are successively commenting that they will no longer blindly accept high priced polysilicon, and will be reducing the utilization to alleviate the insufficient supply of polysilicon, the demand potential remains compelling as the FiT policy of China initiates, and that beneficial reserves and residential projects are to be connected to the grid in 2021, where the market is still the primary factor for polysilicon prices, thus the shipment of polysilicon from stabilized prices will not be affected in the short term.
Wafers
The reduction of operating rate from the downstream sector this week has contracted the demand by a certain degree, and the overall wafer quotations remained sturdy on the weaker end. All market focus is placed on the polysilicon sector after the conclusion of the SNEC expo, and the purchase willingness of the downstream sector is lowered after polysilicon prices become stabilized, with a stronger wait-and-see sentiment, where there are fewer concluded orders in the wafer market as mainstream businesses are focused on fulfilling long-term orders. Simultaneously, cell and module businesses are also gradually lowering their operating rate, which resulted in an apparent deceleration for the downstream sector on the procurement of wafers, and in turn actuated the average prices of G1 and M6 mono-Si wafers to sit sturdily at RMB 5/pc and RMB 5.1/pc, whereas M10 and G12 wafers are now at RMB 5.87/pc and RMB 8.22/pc in average price.
The prices of multi-Si wafers are starting to stabilize and decelerate in inflation as the downstream bargaining starts to impact the market price trend, and that polysilicon prices are stabilizing due to the reduction in end demand.
Cells
Cell quotations started to stabilize this week, with an evident bargaining atmosphere between the upstream and downstream sectors. The mainstream quotation of multi-Si cells is now RMB 0.79-0.89/W, whereas mono-Si G1 and M6 cells are sitting at a respective mainstream quotation of RMB 1.13-1.15/W and RMB 1.07-1.1/W. Mono-Si M10 and G12 cells are now RMB 1.03-1.1/W in mainstream quotation.
The cell and module sectors are successively reducing the operating rate, decelerating the purchases of wafers and polysilicon, and transmitting the pressure to the polysilicon sector, in order to restraint the continuously rising polysilicon quotations. A number of businesses are still purchase small batches to maintain production, though there are now fewer high price orders due to the contraction of production schedules, and the prices of mono-Si PERC cells remain robust, with the average concluded price centralized at RMB 1.05-1.08/W.
Modules
This week saw a low level of concluded orders for modules, as well as predominately sturdy market quotations. The constant upward transmission of end pressure and the emphases from relevant agencies after the conclusion of the SNEC expo have marginally reduced the inflation trend of various PV segments, where the market is now upholding an even stronger wait-and-see attitude, followed by slightly diminished purchase willingness. The mainstream quotation of mono-Si modules remained at roughly RMB 1.8/W this week, though there have been fewer concluded orders. Second and third-tier module makers are still obtaining bids with a quotation that is RMB 0.1/W lower than first-tier quotations in recent tender markets. The large tenders of central enterprises and state-owned enterprises have exhibited signs of initiation, and allow modules of different specifications within the same bid section to complement one another in order to guarantee the commencement of construction. On the other hand, as the PV FiT policy initiates in China, the local policy of each province is prioritized on considering grid-connection for reserve projects, which ensures the profit and demand of new projects in 2021. Regarding overseas markets, partial makers are experiencing a relatively smooth shipment of non-standard products based on the accepted customized orders, and the overall module market will gradually stabilize only after an improvement is seen in the status of polysilicon and wafer sectors.
Glass quotations were sturdy on the whole this week. The module end remains at the bargaining phase right now, with fewer shipment of glass and new orders, which on the contrary resulted in matching supply and demand for the glass market.
（Image：Kimco Realty via Flickr CC BY 2.0）