Significant Drop in Prices for 182mm P-type Cells; Clearing of Old Production Capacity of Cells Accelerates

Polysilicon：

Polysilicon prices continue to decline throughout the week. The mainstream concluded price for mono recharge polysilicon is RMB 62/KG, while mono dense polysilicon is priced at RMB 60/KG and N-type polysilicon is currently priced at RMB 66/KG.

Observing the dynamics in market transactions, the latter part of the month has witnessed a recovery in the crystal pulling market. It is anticipated that the impasse between buyers and sellers, prevalent earlier this month, may see some alleviation. On the supply side, the production processes for new capacity display divergence: established manufacturers have progressed smoothly, reaching their target output, while some new entrants face delays of one to two months due to issues such as production equipment and process debugging.

Turning to the demand side, the inventory levels of downstream wafers have essentially returned to a reasonable level, thereby relieving the pressure of cumulative crystal pulling inventory. Moreover, there has been a resurgence in the activation rate of professional wafer enterprises, stimulating an increase in purchasing demand. Despite a slight decline in P-type polysilicon prices this week, the faster depletion of polysilicon inventory and the more positive downstream customer demand have bolstered the willingness of polysilicon enterprises to support their prices. With the operational rates of N-type polysilicon manufacturers on the rise, their prices can be sustained and are expected to remain stable throughout this week.

Wafer:  

The prices of wafer have maintained stable throughout the week. The mainstream concluded price for M10 P-type wafer is RMB 2.30/Pc, while G12 P-type wafer is priced at RMB 3.30/Pc and M10 N-type is priced at RMB2.40/Pc.

On the supply front, the issue of cumulative inventory has largely been effectively addressed, with specialized wafer manufacturers increasing their activation rates. Projections indicate a low double-digit increase in overall supply for this month, signaling a gradual uptick in availability. Examining specific types, there’s considerable pressure on the shipments of 182mm P-type wafers due to sluggish demand downstream. Additionally, 210mm P-type wafers will continue to experience shipment pressures post the order delivery period.

As N-type wafers are predominantly used by customers, wafer manufacturers are set to adjust the output percentage of N-type wafers this month. On the demand side, the cell link is under significant pressure, making it challenging to prevent a decline in prices. To mitigate losses, there has been a reduction in the old capacity of 182mm P-type wafers, while 210mm P-type wafers are anticipated to undergo price reductions post the order delivery period. Consequently, downstream customers have significantly curtailed their purchases. In this context, if sluggish demand leads to renewed inventory pressures, there remains a likelihood of further downward pressure on wafer prices.

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 0.56/W. The price of M10 mono TOPCon cell is RMB 0.48/W.

On the supply side this week, the price of 182mm P-type cells took a hit, dropping to 0.40 yuan per W, marking a decline rate of 13.04%. The 182mm P-type cells are currently grappling with a market demand dilemma, affirming our observations from last week. We previously posited that the technological iteration in both N-type and P-type cells has entered a critical phase. During this period, the market demand for N-type cells is surging, gradually eroding the market share of P-type cells. Consequently, a substantial portion of the old production capacity of 182mm P-type cells is decreasing to mitigate losses. Additionally, OEM fees for 182mm P-type cells have rapidly reduced to 0.85-0.95 yuan. On the other hand, 210mm P-type cells have found support from order deliveries, keeping their prices stable for the time being. However, as the delivery period concludes, maintaining stability for 210mm P-type cells will prove challenging.

On the demand side, customer demand remains sluggish, and the shipping pressure on module ends is on the rise, impacting module production schedules. Consequently, the purchasing demand for cells has remained unchanged compared to last month, showing no significant improvement. This week, the price of 182mm P-type cells experiences significant fluctuations. Conversely, there is robust demand for 182mm N-type cells, keeping their prices stable. However, 210mm P-type cell prices are expected to decrease due to weaker market demand.

Module:

Module prices have gone down throughout the week. The mainstream concluded price for 182mm facial mono PERC module is RMB 1.03/W, 210mm facial mono PERC module is priced at RMB 1.04/W, 182mm bifacial glass PERC module at RMB 1.04/W, and 210mm bifacial glass PERC module at RMB 1.05/W.

On the supply side, there has been a slight decline in module production scheduling for this month. When analyzing production reductions among different manufacturers, it becomes evident that leading manufacturers are faring better, while second and third-tier companies are teetering on the break-even point. Consequently, they should exercise caution and make prudent choices in production scheduling.

Turning to the demand side, concerning the overseas market, apart from the persisting inventory and demand issues in the fourth quarter, the European Union and Turkey have initiated investigations into the imports of Chinese PV products. This has further impacted sluggish overseas demand, signaling a negative trend in the module market. On the domestic front, provinces have issued warnings on distributed PV grid capacity, introducing uncertainty into the demand for distributed PV. Ground-based installation projects are gradually concluding, leading to a slowdown in purchasing demand. Additionally, it's worth noting that modules returned from the overseas market are being sold at remarkably low prices, exacerbating market concerns about the benchmark price in the module sector.

In summary, module prices have stabilized this week, but the overall market demand remains less than optimistic. Given the sluggish orders in late December, it is predicted that there is still potential for further downward movement in module prices.