By Dong Zitong, reporter of *China Energy News* (July 22, 2024, Page 07)
The price trend of PV supply chain products may show new changes.
Recently, the transaction price of PV wafers has shown signs of rising. Against the background of destocking, relevant manufacturers have begun to show willingness to increase quotations. In the view of industry insiders, in the second half of this year, the price of the PV supply chain will usher in a new adjustment cycle, and the upstream of the industry chain represented by wafers will achieve price recovery first.
I. Upstream Product Prices Expected to Rise
InfoLink, a third-party consulting agency, said that recently, the price trends of PV wafers of different specifications have begun to diverge. The inventory of 182-size and 183N-size wafers is being rapidly reduced, and at the same time, the current inventory scale of PV wafers is also affected by the dilution of subdivided specifications, with some specifications of PV wafers beginning to show signs of tightness. Recently, manufacturers have also successively negotiated price increases for related specifications, with enterprise quotations adjusted from 1.1 yuan per piece to 1.12 yuan per piece.
Specifically, among P-type wafers, the transaction prices of M10 and G12 size products are 1.25 yuan/piece and 1.7 yuan/piece respectively; among N-type wafers, the prices of M10, G12, and G12R size products are 1.1 yuan/piece, 1.6-1.65 yuan/piece, and 1.3 yuan/piece respectively. Compared with the transaction price of 1.12 yuan/piece last week, there are signs of an increase. However, manufacturers' tentative price increases for 183N-size products have not been accepted in large quantities, and the mainstream average price of 183N-size products remains stable at 1.1 yuan/piece.
Entering the third quarter, the price of PV wafer products has a rising trend, showing signs of price adjustment in the PV supply chain. Executives of many enterprises told China Energy News that product prices are expected to rise in the short term, and this will first occur in the upstream of the PV industry chain.
Qian Jing, Vice President of JinkoSolar, predicted that prices will stop falling and rise in the third and fourth quarters, but this will also depend on the trend of PV policies and the speed of capacity clearance. "It is not ruled out that some enterprises will compete with lower prices, but such prices are definitely unsustainable."
II. Driving Price Changes in Other Links
In the past year, prices in major links of the PV manufacturing end have dropped significantly. For P-type products, the prices of polysilicon materials, 182-size wafers, 182-size cells, and double-glass modules have dropped by 45%, 56%, 56%, and 43% respectively; for N-type products, the prices of polysilicon materials, 182-size wafers, TOPCon cells, and double-glass TOPCon modules have dropped by 43%, 61%, 63%, and 45% respectively.
PV is a vertical industry, and the four main links of the supply chain—polysilicon, wafers, cells, and modules—are interlinked, with a single move affecting the whole chain. Recently, changes in the price of PV wafers have also prompted changes in the price of upstream polysilicon.
Data from the Silicon Industry Branch of the China Nonferrous Metals Industry Association shows that polysilicon prices remain stable. The transaction price range of N-type rod silicon is 38,000-42,000 yuan/ton, with an average transaction price of 40,000 yuan/ton; the transaction price range of monocrystalline dense materials is 33,000-36,000 yuan/ton, with an average transaction price of 34,300 yuan/ton; the transaction price range of N-type granular silicon is 36,000-37,000 yuan/ton, with an average transaction price of 36,500 yuan/ton. The downstream of the industry chain basically purchases on demand.
The Silicon Industry Branch said that the recent price of polysilicon has not fluctuated much, which, from the demand side, is affected by the slight increase in the price of some sizes of wafers. It is expected that the price of silicon materials will remain flat and stable in the short term.
However, up to now, the price change of PV wafers has not been transmitted to cells and modules. In the view of Lu Chuan, Chairman of Chint New Energy, the competition between upstream and downstream of the current PV supply chain is fierce, with obvious game characteristics. This requires enterprises to grasp the rhythm well. With the emergence of downstream market demand, the PV supply chain will also usher in a new stage of development.
III. Demand Release Drives Price Rise
Analysts from Guosen Securities believe that in the future, as the global market demand for PV products is further released, the prices of products in various links of the PV manufacturing end will increase accordingly. From the perspective of domestic demand, from January to May 2024, China's new PV installed capacity was 79.15 GW, a year-on-year increase of 29.3%. Stimulated by policies, overseas markets are also expected to usher in a new round of growth.
A number of third-party analysis agencies agree with this. InfoLink predicts that the global new installed capacity of photovoltaic power generation will be 469-574 GW this year, a year-on-year increase of 4%-27%. The Silicon Industry Branch said that since the third quarter of this year, domestic photovoltaic power generation installation projects have gradually increased after the price of the industry chain tends to be stable. Although the component end does not feel it obviously in the short term, in the medium and long term, domestic terminal demand in the second half of the year will definitely be better than that in the first half.
Wood Mackenzie, an international energy consulting company, pointed out in its newly released report that clean energy will occupy an increasingly important position in the global energy structure. It is expected that by 2033, the global installed capacity of photovoltaic power generation and wind power will reach 8 TW. This means that between 2024 and 2033, the annual new installed capacity of global photovoltaic power generation and wind power will reach 560 GW, higher than the total annual new installed capacity of global photovoltaic power generation and wind power in 2023, which was 450 GW.
Luke Lewandowski, Vice President of Global Renewable Energy Research at Wood Mackenzie, said that the global demand for renewable energy has climbed to a new height. Photovoltaics will play a pivotal role in the energy transition. It is expected that between 2024 and 2033, the new installed capacity of photovoltaic power generation will account for 59% of the global new installed capacity of electricity. In addition, in the next 10 years, China will lead the development of the global PV industry, and its new installed capacity will account for half of the global new installed capacity of photovoltaic power generation.
Source: China Energy News
