Polysilicon:
Polysilicon prices continue to decline throughout the week. The mainstream concluded price for mono recharge polysilicon is RMB 60/KG, while mono dense polysilicon is priced at RMB 59/KG and N-type polysilicon is currently priced at RMB 64/KG.
Analyzing market dynamics, the turnover of polysilicon has surged this week compared to the previous one, with several companies securing orders for December. Categorized by polysilicon types, the turnover of N-type polysilicon outperforms that of P-type polysilicon, thanks to robust support from downstream demand.
Despite this positive trend, market sentiment is nuanced. The increasing supply volume, coupled with sluggish downstream demand, has weakened the willingness of polysilicon enterprises to sustain prices. In response, they've opted for a strategic approach, sacrificing some profits to secure more orders rather than engaging in a standoff with crystal pulling manufacturers.
On the supply side, November's polysilicon output exceeded expectations, reaching 157,000 tons. Anticipating further growth in December due to expanding production capacities and delayed production lines coming online, the supply outlook remains optimistic.
Conversely, on the demand side, wafer manufacturers have significantly increased their operational rates, driving a rebound in purchasing demand for polysilicon. However, downstream cell manufacturers, grappling with losses, are signaling potential production cuts. This impending reduction in market demand for wafers is expected to impact the demand for polysilicon negatively.
In summary, polysilicon prices witnessed a decline this week. However, the support for N-type polysilicon prices remains robust, maintaining a consistent price gap with P-type polysilicon. Notably, the polysilicon output for the current month is projected to increase further. On the flip side, with wafer and cell manufacturers poised to cut production, the polysilicon inventory is anticipated to rise later in December, potentially leading to a further decline in prices.
Wafer:
The prices of wafer have all declined throughout the week. The mainstream concluded price for M10 P-type wafer is RMB 2.20/Pc, while G12 P-type wafer is priced at RMB 3.25/Pc and M10 N-type is priced at RMB2.25/Pc.
On the supply side, the wafer inventory is holding steady at a healthy 1.3 to 1.5 billion pieces. However, with specialized wafer manufacturers ramping up their operations in recent days, a marginal increase in wafers for December is anticipated later this month. Despite this, due to sluggish purchasing demand in the downstream industrial chain, the wafer inventory is likely to experience an upward trend.
In terms of wafer types, the widespread reduction in production by cell manufacturers is expected to disrupt the supply and demand balance for 182mm P-type wafers, causing their prices to plummet to a record low of 2.2 yuan/pcs. Furthermore, as more companies shift towards purchasing N-type wafers, the shipment of P-type wafers becomes increasingly challenging, making it difficult for the prices of 182mm P-type wafers to stabilize.
Regarding 210mm P-type wafers, post-delivery period, their prices are anticipated to experience a sharp decline, though not reaching the lowest point. The output of rectangular wafers is set to rise gradually with the production of rectangular wafer manufacturers, expecting a significant increase in market share from Q1 to Q2 in 2024.
On the demand side, current cell prices have fallen below the break-even point for most manufacturers, causing significant losses in P-type cell production capacity. Consequently, manufacturers are frequently cutting the production of P-type cells, and leading companies are maintaining their production lines through in-house production or foundry business. As a result, the demand from cell manufacturers for wafers is projected to hit the lowest point this year.
In summary, wafer prices have experienced a decline this week. The 182mm P-type wafer prices dropped to an unprofitable level of 2.2 yuan/pcs due to the downstream cell price decrease. Following suit, the 210mm P-type wafer prices declined after the conclusion of the delivery period, while the 182mm N-type wafer prices struggled to stabilize amid sluggish downstream demand. It's important to note that wafer inventory will fluctuate with the increase in output later this month, and the expectation is that wafer prices are likely to continue to decrease.
Cell:
Cell prices have diverged this week. The mainstream concluded price for M10 cell is RMB 0.40/W, while G12 cell is priced at RMB 0.48/W. The price of M10 mono TOPCon cell is RMB 0.48/W.
On the supply side, looking at specific types, the pricing for 182mm P-type cells has reached a bottom level at 0.4 yuan/W. At the current price, specialized manufacturers are struggling to turn a profit, with their gross margin dipping into negative territory. Integrated manufacturers, despite the cell prices being below their production costs, are inclined to purchase more cells; however, the demand for 182mm P-type cells has hit its lowest point.
Turning to 210mm P-type wafers, their price swiftly dropped to 0.48 yuan/W after the conclusion of the delivery period, marking a nearly 15% increase in the decline rate. N-type cells continue to face pricing pressures. Leading integrated manufacturers still maintain an advantage with their advanced production capacity. On the flip side, new entrants focusing on N-type cells are feeling the strain on cash flows, prompting a slowdown in their commissioning process to mitigate potential losses. Consequently, we anticipate a decline in production schedules in December as a response to overall industry losses.
On the demand side, the situation for module manufacturers is unfavorable. Apart from a slight uptick in output from leading manufacturers, others are planning to cut their production schedules. In terms of cell types, only high-efficient N-type cells are enjoying strong demand, while other cell types are facing significant pressure.
In summary, this week, the decline rate varies for P-type cells, whereas N-type cell prices have remained stable.
Module:
Module prices have gone down throughout the week. The mainstream concluded price for 182mm facial mono PERC module is RMB 1.01/W, 210mm facial mono PERC module is priced at RMB 1.02/W, 182mm bifacial glass PERC module at RMB 1.02/W, and 210mm bifacial glass PERC module at RMB 1.03/W.
On the supply side, examining the production plans of module manufacturers for this month reveals that, aside from a slight increase in production from leading manufacturers, others are cutting back to varying extents. Looking at production schedules in the overseas market, there’s a substantial 40%-60% decrease in South-East Asia, and the American market remains negatively impacted by sluggish demand, prompting manufacturers to continue their production cutbacks. It is anticipated that module production schedules will see a continued decline this month, with a single-digit month-on-month reduction. Notably, while overall production schedules are decreasing, the trend of N-type modules surpassing P-type modules is becoming more pronounced, with expectations for a gradual increase in N-type module output.
On the demand side, in the overseas market, dominant regions are still grappling with inventory and consumption issues, and the demand recovery is anticipated to extend into the next year. In the domestic arena, ground-based projects are concluding, leading to lower purchasing demand. The fate of distributed PV installations still hinges on the distributed PV installed capacity of major provinces by year-end. Forecasts suggest that commercial and industrial installations will replace household installations in supporting distributed PV installations next year, but attention must be paid to potential policy changes in local government grid connection regulations.
Analyzing recent bidding projects, N-type modules accounted for 32%-35% of the bidding capacity with clear module type requirements from January to October this year. However, the share of N-type modules in bidding projects surged to 75%-77% from October to November, indicating higher recognition for highly efficient N-type modules among downstream customers, thanks to their advantages in power generation gains. This surge also implies a rapid increase in the shipment of N-type modules, while the clearance of P-type module production capacity is expected to accelerate.
In conclusion, module prices have declined this week, and there are no clear signals of customer demand rebounding.