Polysilicon prices continued to drop this week by a diminished reduction of roughly 2.13%. As the end of the month approaches, the market is seen with a slightly invigorated negotiation sentiment, where downstream businesses are successively signing for January orders, and a partial number of first-tier businesses are maintaining their average concluded prices of mono polysilicon at approximately RMB 230/kg, though concluded prices at below RMB 220/kg have appeared in the market. Downstream prices were essentially sturdy this week, where a number of polysilicon businesses are offering a larger space for negotiation for the purpose of lowering their inventory level. Due to the fluctuating polysilicon quotations in the domestic market recently, overseas prices have simultaneously fallen to around US$31.9/kg.
An observation on the production, operation, and shipment status of the domestic polysilicon sector in China indicates that the 12 major businesses there are successively initiating new capacity, which generated roughly 49K tons of polysilicon in December under a MoM increase of more than 10%. Polysilicon price reductions may be suspended and become stable within the short term due to the constantly elevating purchase demand from the downstream sector in preparation for the Chinese New Year.
Wafer quotations had slightly fluctuated this week, with wafer orders starting to enter the implementation phase, followed by gradually certain concluded prices, and a significant reduction in inventory. Sluggish demand has resulted in a drastic depletion in prices for multi-Si wafers, with a mainstream concluded price now arriving at RMB 1.75-1.78/pc. A slight differentiation is seen from the price trends of mono-Si wafers, where G1 has somewhat dropped in mainstream concluded price to RMB 4.76-4.83/pc, while M6 currently sits at roughly RMB 4.9/pc, whereas M10 has now arrived at RMB 5.7-5.8/pc, and G12 is now priced at approximately RMB 8/pc.
An observation on the production, operation, and shipment status of the domestic wafer sector indicates a low level of operating rate, which is expected to increase amidst the continuous fallback of polysilicon prices, as well as the stocking demand from various downstream segments prior to the Chinese New Year. As the wafer sector steadily reduces inventory, a downstream stocking demand had started to surface since late-December, and the bargaining status between polysilicon and wafer sectors will start to clear up. With the reduction of polysilicon prices subsiding, wafer prices may temporarily stabilize.
Cell quotations remained stable on the weaker end this week, with no significant fluctuations on the whole. Mono-Si M6 is temporarily stabilized at RMB 1.02/W in mainstream concluded price, while M10 and G12 are now at RMB 1.08-1.1/W and RMB 1.05-1.12/W. Upstream polysilicon and wafer prices are starting to exhibit a stabilizing tendency as the wafer sector accelerates inventory reduction, followed by successive procurement and ordering from cell businesses. The module end has slightly increased in cell demand this week under the stocking demand for downstream modules prior to Chinese New Year, where the shipment and prices of cells are becoming gradually certain. An observation on the production and operation of the cell sector denotes that partial cell businesses have slightly risen their operating rate, however, the overall operating rate of the market has somewhat depleted under restricted production in certain regions due to the pandemic.
Module quotations had slightly loosened this week, with marginal price reduction seen in partial mono-Si products. Judging by the order conclusion this week, the concluded prices of mono-Si products were evidently lower than that of market quotations, where mono-Si 166mm modules are currently sitting a mainstream concluded price of RMB 1.83-1.88/W, while mono-Si 182mm modules have arrived at a mainstream concluded price of RMB 1.85-1.89/W. The demand for modules this week had primarily come from stocking purposes for Chinese New Year, with no significant improvement in market demand yet. A number of end projects are expected to commence construction after Chinese New Year alongside the reduction of prices in various segments of the PV industry chain recently. First-tier makers are planning to upward adjust their operating in order to implement stocking, while small and medium-sized domestic module makers are maintaining a lower level of operating rate on the whole. Looking ahead to the subsequent market, the demand for the first quarter of 2022 remains ambiguous, and the wait-and-see attitude remains strong within the market. According to the recent domestic project tender prices, there is a larger differentiation among the anticipated prices of module makers, and partial first-tier module makers are still constantly lowering their quotations. The declining tendency is expected to carry on next week for the module market.
In terms of auxiliary materials, glass quotations remained temporarily stable this week, with no signs of sizable fluctuations in the market. 3.2mm and 2.0mm glasses are now sitting at roughly RMB 25-26/㎡ and RMB 19-21/㎡ respectively. Regarding raw materials, stabilized soda ash prices are resulting in a continuous increase in inventory among businesses. Despite marginal reduction in prices from various major segments of the industry chain, glass prices have yet to exhibit recovery signs due to an unclear demand of the end market.