According to EnergyTrend, a research division of TrendForce, polysilicon spot price is closing in on major vendors’ manufacturing cost – this week’s spot price has already fallen below the US$23/kg mark, but vendors indicate polysilicon price is gradually stabilizing. TrendForce believes polysilicon price may hit US$20/kg this year, but as first-tier makers are standing firm on price, second and third-tier manufacturers are unable to make a move on their own. Thus, TrendForce expects polysilicon price will stay above US$20/kg.
Industry players indicate, polysilicon price will continue to fall mainly due to continuous production. Unwilling to hold on to too much inventory, contract-bound makers continue to sell raw materials. Without a significant improvement in market demand, this much supply will likely keep polysilicon market price low, maintaining the downward trend.
Vendors indicate the four main polysilicon suppliers are all highly cost competitive, leaving little breathing room for smaller makers. While there are some manufacturers that want to stabilize price, others are aggressively pushing price down to expedite the elimination of weaker suppliers. Makers with cost advantage and capacity covered by contracts will adjust their product retail prices in accordance with their main competitors. TrendForce expects the market price will be led by the price-cutting makers – with manufacturing cost around US$19-20, suppliers will still see 5-10% profit margins.
In 2012, TrendForce forecasts contract price will be around US$26-28, while spot price will see a low of US$19.5-22.5. Polysilison suppliers are unlikely to follow in the footsteps of cell and wafer makers, especially since installation volume is expected to increase slightly this year. Furthermore, as there has been little news of polysilicon makers resuming halted production, it is probable polysilicon price will stay above US$20/kg.