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Polysilicon prices plummet to critical levels

Polysilicon in China has seen a significant downward trend, with prices nearing the critical threshold of CNY 30 per kg, posing severe challenges to the cash costs of manufacturers involved.

Source: Silicon Industry Branch of China; Chart: Solarbe Global

Compared to prices on May 8, this week’s figures show a continued decline. N-type material prices have narrowed, while p-type prices have diverged significantly. High-quality silicon materials have seen controlled declines, but mono popcorn prices have plunged to CNY 31/kg, challenging the cash costs of all producers.

Industry Response

Solarbe has learned that this week’s polysilicon market saw a significant reduction in transaction volumes, as downstream companies adhere to purchasing only as needed. This has led to a build-up of upstream inventory.

Feedback from related enterprises indicates that five polysilicon manufacturers, including two leading companies, have commenced maintenance shutdowns, with more planning similar measures.

Despite an anticipated drop in polysilicon production to 180,000 tons in May, supply still exceeds demand.

High inventory pressures have prompted some smaller factories to slash prices to recover funds quickly, further driving down prices.

Technology Shifts

Since the latter half of 2023, the PV industry has accelerated its shift from p-type to n-type technology.

The first quarter of this year already saw an oversupply of polysilicon, though there remains a shortage of high-quality n-type materials, which has somewhat supported prices.

However, as the second quarter progresses, polysilicon enterprises have significantly increased n-type material production, and new capacity from leading manufacturers is being gradually released, transforming the n-type market from undersupply to oversupply.

Lu Jinbiao, Vice Chairman of the CNMIA Silicon Industry Branch Expert Committee, noted that with polysilicon prices falling below cost lines, the primary focus for manufacturers is no longer capturing market share but rather minimizing losses and maintaining stable cash flow.

Downstream Impact

Solar wafer and cell prices have also continued to drop this week.

According to Solarbe Consulting, May’s wafer production is expected to be around 63-65 GW, with some second-tier companies cutting production significantly.

Cell production is projected to be around 65 GW, with growth slowing. In light of lower-than-expected downstream demand, future production schedules may see substantial reductions.

High-purity quartz sand prices, a critical input for wafers, have plummeted, causing further wafer price declines without significantly reducing inventory.

This price drop is beginning to affect the downstream market, with an imbalance in n-type cell supply and demand leading to potential further price declines.

Module prices have continued their downward trend this week. Solarbe’s data shows that of the recent 17 GW of modules tendered, 15 GW were for n-type modules, accounting for nearly 90%.

N-type module prices reached a low of CNY 0.8385/W, while p-type modules hit CNY 0.803/W.

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