PV stock clearance is nearly ending. Industry demands continued to increase in April and May this year, but orders for June 2014 remain uncertain. Thus, the spot market is still observing supply and demand changes in 2Q14. Meanwhile, a previous wave of marked down prices and unclear policies in certain markets has led to a beneficial supply and demand situation for buyers. Slower than anticipated stock clearance rates and wafer manufacturers’ high utilization rates led to large price fluctuations within the multi-si wafer market, analyzed EnergyTrend, a research division of TrendForce.
Market demand was strong in 1Q14 and cell orders surpassed expectations. Impacted by supply shortages, manufacturers made emergency procurements several times during January to February 2014, which caused material costs to increase significantly. To prevent the same situation from happening again, manufacturers March wafer stockup obviously increased. However, downstream cell and module manufacturers’ shipments declined because US-China anti-dumping and countervailing issue remained unclear, which slowed down wafer stock clearance. Therefore, multi-si wafer prices continued to decrease at the end of March, due to rising material stockup and easing stock clearance.
On the other hand, pricing strategy is another factor affecting the recent price trend. Manufacturers have adopted different pricing strategies to cope with substantial decline in PV demand. According to EnergyTrend’s investigation, leading manufacturers to use “cost-down” strategy in the market to attract buyers. Leading manufacturers have cut prices by 5% since late March 2014 till recent, which forced competitors to follow suit. In addition, smaller manufacturers have not rapidly expanded production capacity amidst the recent wafer demand rebound, instead these companies have raised the proportion of contract sales. Hence, prices have been stable as market demands drops, and companies have not lowered prices under production capacity and inventory pressure.
This Week’s Price Quotes
Polysilicon, mono-si wafer, cell, and module prices remained steady. First-tier manufacturers’ utilization rates also continued to stay flat. But multi-si wafer average price dropped 1.18% to US$ 1.008/piece, due to weak demands and price competitions.