Orders continued to stream into the photovoltaic (PV) market during the latter half of July, according the latest PV price report by EnergyTrend, a division of TrendForce. Besides China’s domestic demand being spurred by government policy, market demands remain strong across regions, including the United States, Japan and India. Capacity utilization rates continue to rise for all industry participants, and top-tier module manufacturers at downstream will see their capacities fully booked for at least the next three months. EnergyTrend anticipates that high demand will persist to the year’s end, but price increases will be somewhat limited.

"With demands becoming certain, the main factor dictating the prices along the supply chain in August will be China closing polysilicon process trade loophole," said Angus Kao, analyst at EnergyTrend. Polysilicon prices in China may stabilize and then rise when polysilicon imports diminish and demand picks up. Nonetheless, the downstream market will determine the extent of price increase, and prices have been mostly set for August’s downstream orders. Hence, the Chinese polysilicon market will not see a big price jump during this month. The increase will be around 2~3%, from the current price of RMB 116~118/kg to RMB 120/kg.

In the silicon wafer market, demand is shifting towards high-efficiency multi-Si wafer because of efficiency improvements made on PV modules. Since the orders for high-quality wafers have been brisk, the second- and third-tier wafer manufacturers have added their capacities into the production. Thus, wafer price increases have been limited. High-efficiency multi-Si wafers from top-tier manufacturers are expected to reach US$0.835/pc. However, the acceptable price range for most cell makers is between US$0.825/pc and US$0.83/pc. Wafer prices will be eventually decided by the extent of price increase in the raw material and end product markets. 

Furthermore, mono-Si wafer demand will be linked to the system products that are being developed by wafer manufacturers themselves. These projects will be able to consume a part of the overall mono-Si wafer capacity. The room for mono-Si wafer process is relatively large, so EnergyTrend predicts that prices will continue to fall in the mono-Si wafer market as to stimulate demand.

As for the cell market, demand has been strong for high-efficiency multi-Si products in August, with orders once again going to the second- and third-tier. However, module prices have hit the ceiling and there is an excess of cell capacity. Consequently, the price uptrend in the August cell market will be limited as well. Taiwanese high-efficiency cells is project to rise from US$0.31~0.315/W to US$0.313~0.318/W, and Chinese high-efficiency cells will rise from US$0.3~0.303/W to US$0.303~0.306/W. With a pending price hike on multi-Si wafers and cell production costs reaching US$0.30~0.31/W, a slight increase to cell prices will provide only a limited contribution to cell companies’ margins. Thus, the mid-stream of the supply chain is still struggling to maintain profitability.

Module prices are stable in the short term as the current mainstream modules have reached 255~260 W in efficiency level. Owing to high demand, the vertically integrated top-tier module companies in China will be able to maintain fully booked capacity for at least the next three months. Many orders have also be sent to the second- and third-tier module makers, which will keep the market well supplied with their capacities. EnergyTrend expects that module prices during August will not increase significantly, and instead the market will have small price fluctuations within a narrow and fixed range.

This Week's Spot Price

Downstream order visibility will be higher as peak-season approaches. Polysilicon manufacturers have started to increase prices, but most of the clients remain conservative and are waiting to see what will happen after China suspends the processing of applications for the polysilicon OEM trading business in August. Thus, the polysilicon trading price remained at US$16.1/kg.

Orders have poured in for high-efficiency multi-si wafers. Multi-si wafer prices have also begun to reflect an uptrend. This week’s multi-si spot price increased 0.36% to US$0.828/piece; mono-si price dropped to US$0.95/piece as mono-si wafer manufacturers hoped to get certain amount of orders.

Demand remained strong for cells with efficiency above 17.8%-18%. High-efficiency multi-si cell price increased 0.64% to US$0.315/W. Multi-si cell price in Taiwan declined 0.34% to US$0.295/W and that in China stay at US$0.289/W. Mono-si cell price dropped to US$0.348/W in China.

Module order visibility is high. But module prices will be difficult to increase due to long credit terms and tier-two manufacturers’ large production capacity. 260W high-efficiency multi-si module price remained at US$0.538/W, while 270W-275W mono-si module price stayed at US$0.61/W.