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Module Prices and Operating Rate May Endure Pressure as Wafers and Cells Follow Up on New High Polysilicon Prices
2022-07-07   |  Editor:et_editor  |  174 Numbers

Polysilicon

Polysilicon prices continued to rise this week, with overall mono polysilicon quotations arriving at a new high of roughly RMB 290/kg. Polysilicon prices have been ascending on a faster pace recently primarily owing to the excess demand status of the polysilicon market that has now exacerbated. Polysilicon businesses have signed for their long-term July orders, with some orders being signed until August. Several businesses are exhibiting apparent reluctance in selling by only willing to sign for 1-2 weeks of orders since they are optimistic towards subsequent polysilicon prices.

An observation on the production and operation status of the polysilicon segment indicates that East Hope has yet to recover production from overhaul, while another four businesses are also gradually entering overhaul. Domestic polysilicon output is expected to drop marginally, whereas the restricted number of arriving ships carrying imported products will also result in a reduction of overall supply within the short term. The persisting end demand that has led to an increase in wafer demand and aggravated the excess demand status has provided sufficient support for polysilicon prices. Sporadic and urgent orders are likely to yield a continuous surge in polysilicon prices before long-term orders for August are signed.

Wafers

Wafer prices had simultaneously risen this week, where M10 and G12 were concluded at a respective mainstream price of approximately RMB 7.25/pc (an increase of 5.69%) and RMB 9.55/pc. LONGi announced its latest round of wafer prices on June 30th, where the P-type M10 160μm wafer is now RMB 7.3/pc under an increase of 6.41%, while the M6 wafer has been adjusted from RMB 5.72/pc to RMB 6.08/pc under an increase of 6.3%. The particular upward price adjustments remain as the result from the sizable increment of polysilicon prices, for which wafer businesses have successively chosen to respond by increasing their prices. In addition, the restricted output of polysilicon has confined wafer output, which remains scarce in supply under incessant demand. Cells are more accepting towards risen prices under the maintenance of profitability. The steadily expanding production lines for M10 cells have stimulated demand for M10 wafers, and the constrained supply and demand of M10 will persist for the short term. A further increase of polysilicon prices subsequently will also trigger an increase in wafer prices.

Cells

Cell prices had ascended evidently this week, where mono-Si M6, M10, and G12 were respectively risen to approximately RMB 1.22/W, RMB 1.26/W, and RMB 1.21/W in mainstream concluded prices. Tongwei announced its latest cell quotations on July 1st, where 166mm, 182mm, and 210mm are now respectively priced at RMB 1.24/W, RMB 1.26/W, and RMB 1.23/W under a respectively increase of 6%, 5%, and 4%. There were fewer new cell orders this week, with focus placed on fulfilling previous orders. Recent cell prices have followed up on the inflation of the upstream sector, alongside a better transmittance of cost pressure, as well as a higher operating rate. Due to restricted upstream output of polysilicon and wafers, the cell market is currently somewhat insufficient in provision, and is maintaining robust quotations, where partial orders of mono-M10 cells are being concluded at a high level of RMB 1.28/W. A number of second and third-tier businesses are commenting on the slightly weakened willingness in current module procurement, where some new orders that are still under negotiation are expected to gradually fall in place next week.

Modules

Module prices continued to stabilize this week, where mono-Si 166mm, 182mm, and 210mm modules were respectively concluded at a mainstream price of roughly RMB 1.88/W, RMB 1,93/W, and RMB 1.93/W. Module cost has further elevated amidst the aggressive inflation in various upstream segments. Module makers were attempting to increase their prices this week, which are not accepted by several domestic centralized projects as seen from their suspended inventory pull, though a number of distributed projects are still being concluded. Simultaneously, overseas markets are more accepting towards the corresponding prices, which generated additional export orders. With the persisting demand for modules, the overall operating rate of the industry has yet to be drastically downward adjusted, and the market is still under continuous bargaining. An incessant increase in subsequent cost may lower the operating rate of modules. As for N-type modules, a small increase is seen from market quotations, which now sit at RMB 2.1-2.16/W in the midst of steadily subsiding low-price resources.

Regarding auxiliary materials, glass quotations remained overall robust this week, with 3.2mm and 2.0mm glasses sitting at a respective price of approximately RMB 28-29/㎡ and RMB 22-23/㎡. Having lowered their procurement, and amplified in cost pressure due to the apparent inflation from the upstream industry chain, module makers are now apparent in glass negotiations, with slight loosening in the focus of partial transactions. In terms of capacity, a number of new production lines are still planned for ignition at the end of the month with continuous increment in supply.

 
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