Prices Stabilize this Week, but the Solar PV Value Chain Still Lacks Fundamental Support for a Broad Rebound

Polysilicon

Supply side:

Polysilicon inventory remains elevated. Supply from polysilicon producers is relatively stable in May, with no substantial production cuts implemented so far. Inventory digestion pressure remains significant, and spot market transactions are still mainly concentrated in non-futures products and deliveries of previous orders. Newly added supply will require more time to be absorbed by the market.

Demand side:

Supply and demand remain in a weak balance. Contract activity about spot polysilicon ahead of the May Day holiday was subdued, while mainstream mono recharged polysilicon and mono dense polysilicon were increasingly directed toward futures delivery. Market procurement momentum remains weak, with strong wait-and-see sentiment prevailing across the market.

Price trend:

Spot prices have rebounded slightly to RMB 33–35/kg. Although this represents a modest recovery from previous lows, the move has mainly been supported by policy expectations and price-support strategies from leading polysilicon producers. Without meaningful production cuts, however, high inventory levels remain a major constraint, making a full price reversal difficult in the near term.

Wafers

Supply side:

Industry inventory has risen to around 3 billion wafers, with the inventory accumulation trend continuing. Supported by previously secured low-cost polysilicon feedstock and optimistic expectations for future demand, most wafer producers have continued ramping up output despite already elevated inventory pressure, further exacerbating oversupply on the supply side.

Demand side:

Although the ramp-up of domestic utility-scale solar projects after May is expected to support demand for large-format wafers, manufacturers have already front-loaded production schedules in anticipation. Existing high wafer inventory levels are sufficient to cover incremental orders. Therefore, in the short term, demand growth is unlikely to keep pace with production expansion, leaving inventory reduction pressure substantial.

Price trend:

The industry’s structural oversupply remains difficult to reverse in the near term. Burdened by heavy inventories and market demand that has already been partially pulled forward by utility-scale solar projects, wafer prices are expected to remain under pressure, with limited momentum for a meaningful rebound.

Cells

Supply side:

Industry inventory has increased to around 8–9 days and continues to trend slightly higher. Cell production schedules in May still show signs of expansion, with supply capacity continuing to increase. However, limited new order intake has prevented any meaningful easing in shipment pressure, and the oversupply situation is unlikely to improve materially in the short term.

Demand side:

Downstream module manufacturers continue to adopt aggressive price-cutting procurement strategies, leaving cell producers struggling with insufficient order volumes. Although cell manufacturers show strong willingness to raise prices, weak restocking demand keeps them in a disadvantaged position in ongoing market negotiations.

Price trend:

Cell prices are currently hovering around RMB 0.33/W. Due to cell inventory overhang and persistent downstream cost-reduction pressure, prices lack upward momentum and are expected to remain weak in the near term. In addition, close attention should be paid to the transmission effect of silver price fluctuations on cell production costs and pricing dynamics.

Modules

Overall demand in May is still mainly supported by domestic utility-scale solar PV projects, while overseas demand remains subdued. Broad market demand conditions therefore continue to look weak.

Persistently low wafer and cell prices upstream have further weakened cost support for modules. Although leading module manufacturers continue to maintain relatively high offer prices, actual transaction prices have generally fallen to RMB 0.75–0.78/W. Most domestic utility-scale projects are still priced below this range, while some low-priced orders at RMB 0.72/W have already entered the delivery stage.

Overall, amid unresolved supply-demand mismatches, declining costs, and weak market demand, module prices continue to face downward pressure.