PV Supply Chain: Upstream Near Cost Floor Stabilizes, Downstream Faces Dual Pressure and Prices Continue to Decline

Polysilicon

Supply side: Current polysilicon inventory remains massive, holding above 520,000 mt in aggregate, with the overall inventory build-up trend persisting and stockpile pressure remaining severe. Factoring in estimated April output of approximately 86,000 mt against actual downstream consumption capacity, the polysilicon supply remains in surplus. Obviously, the polysilicon segment continues to continues to exhibit a mild inventory build.

Demand side: As polysilicon prices have fallen to levels close to ingot producers’ target thresholds, downstream purchasing willingness has begun to recover. Some ingot producers view current levels as an entry point and have started to replenish inventories. As a result, overall transaction volumes have seen a slight uptick recently, and market sentiment has improved marginally.

Price trend: Actual transaction prices have now fallen to the RMB 30–35/kg range, approaching the downside limit, with very limited room for further declines. However, given the persistent oversupply, upward momentum remains lacking. In the short term, polysilicon prices are likely to stabilize and move sideways at low levels.

Wafers 

Supply side: Wafer inventories remain elevated above 25 GW, and the overcapacity situation persists. Although leading players have initiated production cuts, the scale remains smaller than reductions in the downstream cell segment, leaving relative supply still in surplus and making destocking challenging.

Demand side: Demand has weakened sharply due to significant production cuts among specialized cell manufacturers. Wafer orders have declined rapidly, and downstream procurement willingness has fallen to extremely low levels. Market demand continues to contract and is unlikely to absorb the large market supply in the near term.

Price trend: Declining upstream polysilicon prices have weakened cost support, while shrinking downstream demand continues to exert pressure, pushing wafer price levels lower. In the short term, prices have already fallen below cash cost levels, effectively signaling a bottom. In conclusion, wafer prices are expected to move sideways with low-level volatility going forward.

Cells

Supply side: Cell inventories remain at around 8–10 days. While destocking pressure persists, a large portion of cell inventory is held in overseas warehouses and by traders, with leading manufacturers maintaining relatively low in-house inventory levels. To mitigate risks, tolling activity has increased, and industry-wide production cuts have been fully implemented in April, leading to active supply contraction.

Demand side: Both domestic and overseas market demand have entered a clear phase of decline, with trading activity dropping sharply. New orders are scarce, transactions are difficult to conclude, and shipment resistance continues to rise, while downstream players adopt a strong wait-and-see stance.

Price trend: To ease shipment pressure, some cell producers have resorted to aggressive low-price sales, leading to disorderly pricing in the cell market. Cell prices have continued to fall toward RMB 0.33/W. Although broad production cuts provide some support, near-term price trends remain highly sensitive to silver price movements, which should be closely monitored.

PV Modules

Supply side: As orders shrink, module manufacturers have begun actively reducing output, with production schedules cut significantly. Industry-wide output plans for the month have declined by more than 10% month-on-month, with producers broadly slowing production to cope with weak market conditions.

Demand side: In April, market demand shows weakness both domestically and overseas. Overseas markets have cooled noticeably, while domestic demand has failed to pick up. Widespread wait-and-see sentiment downstream has led to a severe shortage of new orders, and overall trading conditions remain subdued.

Price trend: Although leading manufacturers are maintaining firm headline quotations, actual transaction prices have fallen below RMB 0.78/W, approaching the RMB 0.75/W cost line. With upstream cell prices continuing to decline and cost support weakening further, module prices remain under dual pressure from soft demand and falling costs, leaving room for further downside in the short term.