Resurgence in Polysilicon Prices and 182mm P-Type Modules Lead the Charge in Price Recovery
2024-02-02 9:10

Polysilicon prices have increased throughout the week. The mainstream concluded price for mono recharge polysilicon is RMB 60/KG, while mono dense polysilicon is priced at RMB 58/KG and N-type polysilicon is currently priced at RMB 71/KG.
Based on the current transaction dynamics, the majority of enterprises have completed order signings for February. Analyzing the transaction prices reveals an upward trend in orders with higher prices, consequently driving up the median price. On the supply side, crystal pulling manufacturers still have demand for stockpiling, providing robust support for N-type polysilicon. Additionally, these manufacturers have started accepting the tentative increase in quoted prices and are making deals at the higher tentative prices. As a result, the average price of N-type polysilicon has surged to 71 yuan/KG, prompting P-type polysilicon to follow suit due to its potential substitution for N-type polysilicon during shortages.
Turning to the demand side, with the Spring Festival holiday approaching, some crystal pulling manufacturers had plans to reduce operational rates. However, current operational rates remain stable. Their demand for polysilicon stems from their intention to accumulate low-price products and meet production needs, making operational rates a critical factor. Presently, downstream cell and module manufacturers have significantly reduced production, leading to a more severe accumulation of inventory. Consequently, crystal pulling manufacturers may scale back production schedules due to inventory pressure, impacting the demand for polysilicon. This week marks the completion of most orders, resulting in limited deals later in the month. The polysilicon price is expected to remain stable. It's worth noting the possibility of new polysilicon production capacity coming online. However, if the demand from crystal pulling manufacturers cannot match the polysilicon supply, there will be greater price pressure on P-type polysilicon, while N-type polysilicon will be affected by inventory levels among crystal pulling manufacturers.

The prices of wafer have diverged throughout the week. The mainstream concluded price for M10 P-type wafer is RMB 2.05/Pc, while G12 P-type wafer is priced at RMB 3.00/Pc. The mainstream concluded price for M10 N-type wafer is RMB 2.00/Pc and G12 N-type is priced at RMB 3.10/Pc.
On the supply side, the operational rates of crystal pulling manufacturers have held steady. However, the wafer inventory has swelled to 1.9 to 2.1 billion pieces due to sluggish customer demand, resulting in an increase in inventory. Notably, N-type wafers are claiming a growing share in the inventory, posing a risk of oversupply as demand for them remains stagnant. Turning to the demand side, with the impending Spring Festival, most cell manufacturers are planning production cuts in February. Consequently, their production schedules are on a downward trajectory, leading to reduced demand for purchasing wafers. Furthermore, some cell manufacturers are hesitant to sell P-type products at low prices, and there continues to be demand for P-type cells in both domestic and overseas markets post-Spring Festival. Hence, it is certain that P-type cell prices will rebound, with this week's prices indicating the post-holiday trend. In the case of N-type cells, manufacturers are set to reduce production in February, widening the supply and demand gap for N-type wafers and resulting in a further accumulation of inventory. However, considering the increase in polysilicon prices, N-type products have gained more support from the cost side. Consequently, their prices will be under pressure and consolidation, leading to heightened competition in the market.

Cell prices have diverged this week. The mainstream concluded price for M10 cell is RMB 0.380/W, while G12 cell is priced at RMB 0.380/W. The price of M10 mono TOPCon cell is RMB 0.46/W, while that of G12 mono TOPCon cell is RMB 0.49/W.
On the supply side, a significant number of cell manufacturers are gearing up for substantial production cuts, with actual production scheduling estimated at 40-43 GW, showcasing a continual decline in month-on-month capacity. Given that cell prices are currently lower than the costs incurred in the third quarter of 2023, the profit outlook for the cell segments appears bleak. A detailed analysis of manufacturer performance reveals that those with a higher share in P-type cell production capacity experienced more significant losses in the fourth quarter of 2023. Despite this, the demand for high-efficient P-type cells remains substantial due to existing orders for delivery in both domestic and overseas markets in 2024. However, as many cell manufacturers ceased P-type cell production in the fourth quarter to avoid losses, the production of P-type cells is limited, resulting in a distinct shift in P-type cell transactions. Anticipating a significant reduction in production due to blackouts and diminishing profits, N-type cell manufacturers are expected to follow suit. Nevertheless, the N-type cell supply won't be as intense, given the simultaneous contraction in downstream customer demand for N-type cells. In conclusion, the price trend for N-type cells in the first quarter of 2024 remains uncertain, driven by the sluggish demand for these cells.

Module prices have remained stable throughout the week. The mainstream concluded price for 182mm facial mono PERC module is RMB 0.93/W, 210mm facial mono PERC module is priced at RMB 0.95/W, 182mm bifacial glass PERC module at RMB 0.94/W, and 210mm bifacial glass PERC module at RMB 0.97/W.
On the supply side, module production scheduling is anticipated to decrease by 28% to 32% in February compared to the previous month. Leading manufacturers are clearly signaling production cuts, and some second and third-tier manufacturers are gearing up to halt production and take a holiday. While leading manufacturers exhibited strong performance throughout 2023, the net profits of some took a significant hit in the fourth quarter of the same year. Notably, the net profits of second and third-tier manufacturers even turned negative, putting them under considerable pressure. The performance disparities among module manufacturers are evident, especially considering the assets depreciation of P-type production capacity. Therefore, keeping an eye on the progress of P-type production capacity in 2024 remains crucial. On the demand side, with the approaching Spring Festival, the purchasing process in the domestic market is gradually slowing down, resulting in weak demand for modules. However, overseas demand is expected to pick up after the first quarter, driven by installations stimulating customer demand for modules. The price trend of modules post-Spring Festival hinges on customer demand, with the inflection point in module prices not expected until Q2 and Q3 when the clearing of backward production capacity is finished, and the demand for high-efficient N-type modules truly increases.

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