Polysilicon Prices Face Rising Downside Risk Below RMB 60/kg, while Cells and Modules Prices Remain Strongly Cost-supported

Polysilicon 

Supply side:

Polysilicon inventories have now surpassed 500,000 tons and continue to build up. However, previously implemented anti-rat race (anti-neijuan) measures in order to reduce polysilicon production sees no result. And combined with increased spot selling by traders, effective polysilicon supply remains significantly oversupplied.

Demand side:

Market demand has weakened sharply, with cost pressure rapidly transmitting upstream. Ingot manufacturers, facing rising production costs, show strong resistance to high-priced polysilicon and are increasingly aggressive in pushing prices down. Overall market absorption capacity remains weak.

Price trend:

Following regulatory talks with the Market Supervision Authority, bearish price expectations have intensified. Spot offers below RMB 60/kg have already emerged. Under the dual pressure of regulatory oversight and downstream resistance, polysilicon prices face further downside risk in the short term.

Wafers

Supply side:

Wafer inventories remain elevated at above 20 GW. Although wafer manufacturers are attempting to hold prices, limited actual shipments have resulted in slow destocking, leaving wafer inventory levels largely unchanged. High inventory pressure continues to be the key constraint.

Demand side:

Cell manufacturers have shown only marginal production increases, providing limited real support for wafer demand. At the same time, rising silver prices are squeezing cell production costs, while cell price hikes remain difficult to pass through. As a result, cell makers’ profitability has deteriorated, strengthening their push to force wafer prices lower.

Price trend:

Upward price momentum is weak now. With weakening polysilicon prices loosening cost support and downstream cell manufacturers exerting pricing pressure, wafer prices are unlikely to remain firm and are expected to trend mildly downward in the near term.

Cells

Supply side:

Significant industry-wide production cuts have reduced inventory to 6–8 days, with levels continuing to decline. Except for a few players ramping up utilization, most cell manufacturers are operating at low utilization rates amid cost and shipment pressures, leading to a clear contraction in overall supply.

Demand side:

Shipments have improved modestly following the implementation of export tax rebate policies. While overseas orders have increased, they are largely concentrated among vertically integrated players, offering limited benefits to standalone cell manufacturers.

Price trend:

Driven by a sharp surge in silver prices, which have significantly lifted non-silicon costs, mainstream cell prices have remained firm above RMB 0.40/W. In the short term, strong cost support limits downside risk. Future price movements will depend heavily on silver price volatility and the extent of polysilicon price concessions in the upstream segment.

PV Modules 

Supply side:

Market inventories have seen notable destocking. On one hand, distributors and solar PV project developers have rushed to stockpile low-priced orders amid concerns over potential price hikes. On the other hand, large volumes of modules have been rapidly shipped to overseas warehouses, effectively shifting inventory from factories to overseas and channel inventories.

Demand side:

Stimulated by export tax rebate policies, overseas demand has been prioritized, with incremental orders mainly flowing to leading integrated players such as LONGi. In contrast, the domestic market shows limited acceptance of RMB 0.80/W pricing, with current transaction volumes dominated by overseas markets.

Price trend:

Module prices have rebounded quickly, driven by rising cell costs. Supported by overseas orders and stockpiling demand, module prices show strong short-term resilience. Going forward, key variables to watch include the sustainability of overseas demand and further cost disruptions stemming from silver price fluctuations.