Weekly Solar Market Price Trends: Mainland China Report 14

Solarzoom Solar Market Report Oct 29-Nov 2, 2012

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Silicon material

The domestic market price of level-1material is 128 CNY/kg, and 120 CNY/kg for level-2 ones.  The price of the imported level-1 materials is $18.98 /kg, while it stands at $18.709 /kg for level-2 ones.

Nowadays, most domestic silicon material manufacturers have shut down. Manufacturers are rarely producing, and their capacity utilization is all maintained at low levels in order to avoid the aging of equipment and to cut down the cost. At present, the order condition is still disappointing. The trading condition is also pretty disappointing this week, with some buyers who have demands just making inquiries, but no purchase. What’s worse, the price has been lower than what manufacturers can accept. And considering the poor liquidity condition, many manufacturers who have a large volume of inventories are now beginning to undersell their products; however, the present demand is quite sluggish and the price is very likely to have a further drop in the short term. According to the importing data, in September, the importing volume of poly silicon material reached a new high, about 8720 tons, which pressured domestic silicon material producers on pricing. Regarding the policies, China’s Commercial Ministry decided to have an anti-dumping investigation into the imported poly silicon from Europe last week.

Wafer
This week, regarding mono-c-Si 125mm*125mm wafer, the price of tier-1 suppliers stood at 5.0 CNY/pc, and at 4.1 CNY/pc for tier-2 ones. As to mono-c-Si 156mm*156mm wafer, the price of tier-1 suppliers arrived at 7.8 CNY/pc, and 7.35 CNY/Pc for tier-2 ones. In terms of poly-c-Si 156mm*156mm wafer, the price of tier-1 suppliers reached 6.60 CNY/pc, and 5.8 CNY/pc for tier-2 ones.

Recently, the circulation of wafers dropped sharply. Although the wafer market retains the downtrend owing to the slack demand, the price is expected to not to have a further decline since the inventories of most manufacturers are at a low level, which eases the pressure on wafer manufacturers. Now, most manufacturers are rigorous to the payment terms. In order to support their operation and maintain the utilization, some manufacturers have to accept long-term credit days, which increase the pressure and weaken the cash flow among the whole industry. Restricted by the cost, the price of wafer will slow down its decrease and it will keep fluctuating in the short term.

Cell

Currently, considering mono-c-Si 125mm*125mm cell, the price of tier-1 suppliers stood at 2.9 CNY/W, and 2.4 CNY/W for tier-2 ones. Regarding mono-c-Si 156mm*156mm cell, the price of tier-1 suppliers arrived at 3.0 CNY/W, and 2.55 CNY/W for tier-2 ones. In terms of poly-c-Si 156mm*156mm cell, the price of tier-1 suppliers reached 2.45 CNY/W, and 2.1 CNY/W for tier-2 ones.

This week, the price of cell had no change. Nowadays, the market demand is stagnant. The utilization of most cell manufacturers saw no large improvement, and there are few large-scale orders. Q4 is a traditional slack season, and it is expected that the market will remain gloomy.

Since Grade B cells are very popular in recent days, the market of Grade A cells is very weak. And, considering the price of module has remained in a downtrend, most cell buyers will still take the cost into consideration and choose the cheaper ones. At the moment, the price is approaching the cost line, and it doesn’t decrease as quickly as before. According to the present situation, the price will keep dropping slightly in the short term.

Module

Concerning mono-c-Si 190W module, the price of tier-1 suppliers stood at 4.35 CNY/W, and 3.95 CNY/W for tier-2 ones. As to mono-c-Si 245W module，the price of tier-1 suppliers arrived at 5.0 CNY/W, and 4.55 CNY/W for tier-2 ones. In terms of poly-c-Si 230W module, the price of tier-1 suppliers reached 4.1 CNY/W, and 3.65 CNY/W for tier-2 ones. Concerning mono-c-Si 195W module, the price of tier-1 suppliers stood at 4.60 CNY/W, and 4.0 CNY/W for tier-2 ones. As to mono-c-Si 250W module, the price of tier-1 suppliers arrived at 5.10 CNY/W, and 4.6 CNY/W for tier-2 ones. And in terms of poly-c-Si 240W module, the price of tier-1 suppliers reached 4.30 CNY/W, and 4.0 CNY/W for tier-2 ones.

Presently, the whole domestic module market is slack and the demand is shrinking. Some small- and medium-scale manufacturers mainly sold their products to Europe before, but now they are losing their market share there owing to the AD&CVD investigation. As a result, they have to keep cutting their output, and it is difficult for them to support their operation into the next year. As to the domestic market, the condition of some module manufacturers who have projects is satisfactory, and they usually produce modules for their own use. Meanwhile, those small- and medium-scale manufacturers, except some shut-down ones, are mostly doing OEM or transferring their production on small-scale systems. Now, the market is stable, and it will not have further decline in the short term. We have reports that tier-1 manufacturers, more so the leading ones, have returned to full utilization, having expectations to run full capacity until middle of December.

Tier-one companies include the U.S. and HK stock market-listed entities, with large capacity and product circulation in the market, like Suntech Power Holdings Co., Ltd. (ADR)(NYSE:STP), Yingli Green Energy Hold. Co. Ltd. (ADR) (NYSE: YGE), Canadian Solar Inc. (NASDAQ: CSIQ), Trina Solar Limited (NYSE: TSL), JA Solar Holdings Co., Ltd. (ADR)(NASDAQ: JASO) and ReneSola Ltd. (ADR)(NYSE: SOL)

Prices quoted in CNY include 17% VAR domestic tax