This week, polysilicon prices continued to rise, with quotations increasing significantly by 25%–35%. However, the volume of new order transactions remained limited. The price hike was mainly driven by the fact that polysilicon producers have been operating at a loss for over a year. In an effort to clear inventory, prices had fallen well below the overall cost line. To comply with the regulation prohibiting sales below cost, producers have now raised prices in one go to levels above their comprehensive cost.

With prices across downstream sectors yet to stabilize, wafer manufacturers are still adopting a wait-and-see approach and have not widely accepted the price increase. As a result, new deals for polysilicon remained scarce this week. Notably, while new orders were limited, the expectation of further price hikes has led to stronger fulfillment of previously signed contracts. Downstream players have shown a heightened urgency in urging deliveries, in sharp contrast to the frequent cancellations observed in earlier periods. This indicates that the polysilicon market is showing signs of bottoming out and stabilizing.

Looking ahead, there are currently nine polysilicon producers operating in China, with significant differences in comprehensive costs due to variations in geographic location and resource endowments. As a result, prices are also increasingly differentiated. Given limited downstream demand, products with relatively uniform quality and lower prices will be prioritized in transactions. In this round of price hikes, companies with higher production costs are at a relative disadvantage. If they face long-term inventory buildup and lack cash flow support, they may be forced to halt production. This could, in turn, drive a restructuring of the polysilicon supply landscape.

Essentially, this “anti-involution” action serves as a test of each company’s cost competitiveness. In the future, polysilicon producers will also face increasing pressure for passive adjustments in areas such as energy efficiency, emission reductions, and green, low-carbon operations.

In summary, the current cyclical adjustment of the polysilicon industry is on the right track, but a deeper correction and market shakeout are still necessary. In the short term, the market will likely remain in a wait-and-see mode, with prices potentially seeing a slight upward trend driven by market expectations. Once supply and demand fundamentals improve meaningfully—and provided strict policies effectively prevent the restart of outdated capacity—polysilicon prices are expected to gradually return to a reasonable range.

Source：https://mp.weixin.qq.com/s/Nj_huNZl5cXusBwMzOBMbg