According to EnergyTrend, a research division of TrendForce, solar PV market demand has plummeted recently due to the passing of Germany’s new subsidy policy, in addition to news of the Italian government’s plans to shrink solar subsidies also. Furthermore, as the anti-dumping duties imposed on China by the U.S. are lower than generally expected, it is said that Taiwanese module makers have been asked to temporarily suspend shipments. With the steady news of unfavorable market factors, this week’s spot prices saw significant adjustments.

PV vendors indicate, currently the Italian government’s policy draft plans for significant solar subsidy cuts – the new policy is expected to be passed in mid-2012. Furthermore, as Germany’s new subsidy policy officially took effect on April 1, market demand has been on a steady downward slide for the past two weeks. As buyers’ price expectations are a far cry from what vendors are prepared to offer, the spot market is looking somewhat barren.

EnergyTrend research indicates, currently solar cell manufacturers are keeping stock levels around one week’s worth or so. Some module makers have received requests from clients to temporarily suspend shipments, but whether or not the orders will be cancelled is unclear as of yet. Additionally, manufacturers have lowered capacity utilization rates significantly, and are conservative towards Q2 levels. Makers are engaging in strict inventory management to prevent losses due to excess stock.