The reduction of polysilicon prices had further subsided this week, with quotation on overall mono polysilicon dropping to roughly RMB 228/kg. An apparent bargaining sentiment is seen between the upstream and downstream sectors, where the supply and inventory of polysilicon will somewhat increase under the gradual release of expanded capacity and the approaching Chinese New Year, and wafer businesses are now holding onto a stronger wait-and-see attitude from an anticipation towards a further reduction in polysilicon prices. In terms of demand, the decline in prices from various segments of the industry chain, as well as the 331 installation rush overseas, and the stocking demand for Chinese New Year, have contributed to the steadily rising demand for polysilicon.
An observation on the production, operation, and shipment status of the polysilicon sector indicates that polysilicon businesses had concluded new orders this week due to an increase in wafer demand, with sporadic and urgent orders occupying the most ratio, and fewer long-term orders. Some polysilicon businesses reflected on how wafer businesses have been upward adjusting their operating rate recently, which is expected to increase to more than 70%, and have been frequently requesting for polysilicon quotations. The aforementioned actions provided enough support to further contract the reduction of polysilicon prices this week. Polysilicon quotations are expected to stabilize within the short term owing to Chinese New Year stocking, amplified purchase demand, utilization increment, and the anticipation for improvement from the end market.
Wafers
Wafer prices had slightly risen this week, where the bargaining between wafer and polysilicon sectors remained evident. M6, M10, and G12 wafers were concluded on mainstream prices of roughly RMB 4.95/pc, RMB 5.85/pc, and RMB 7.7/pc respectively this week. With the significant bargaining going on between wafer and polysilicon businesses, the latter maintained a lower level of operating rate this week in the hopes of getting a further reduction in polysilicon prices, though an elevation in purchase demand from the cell and module sectors had yielded a constrained supply of wafers this week, where the anticipation from partial wafer businesses pertaining to a stronger degree of inflation resulted in apparent sales reluctance. In addition, the purchase demand for mono-Si M6 wafer continues to rise, though the product is exhibiting a structural shortage as businesses are currently occupied by productions of large-sized M10 and G12 wafers.
An observation on the production, operation, and shipment status of the wafer sector denotes a lower level of operating rate in the particular sector due to bargaining needs. The operating rate will increase marginally under depleted inventory, as well as short-term stocking demand for the Chinese New year and the anticipation for improvement within the end market. As bargaining reaches its final stage, wafer prices will become sturdy under further stabilization in polysilicon prices.
Cells
Cell quotations remained sturdy on the whole this week, with smooth shipment in large-sized M6 and M10 products. The demand for mono-Si M6 cells had increased this week, though the fewer production schedules for mono-Si M6 products from cell businesses as a result of additional occupancy by large-sized M10 and G12 products had led to an increment in mono-M6 purchases, where the confined supply pushed the mainstream concluded price for mono-Si M6 cells to RMB 1.05/W this week, with M10 and G12 rising to approximately RMB 1.08/pc and RMB 1.05/pc respectively. Cell businesses are expected to gradually recover in profitability following the marginal reduction of polysilicon prices recently. Downstream module demand has slightly recovered thanks to the 331 installation overseas and Chinese New Year stocking demand, and cell businesses are anticipated to upward adjust their operating rate to 60-70%.
Modules
Module prices remained stable this week, and the improved end demand led to an increase in utilization. The apparent fallback of upstream polysilicon and wafer prices recently has somewhat lowered the production cost for the module sector, and a partial number of previous orders that were suspended due to exorbitant prices are starting to resume production and delivery. Mono-Si 166mm modules are currently being concluded at roughly RMB 1.84/W at a larger interval of concluded market price, while mono-Si 182mm and 210mm modules are concluding at approximately RMB 1.85/W and RMB 1.87/W respectively. Statistics are indicating that domestic grid-connection may exceed anticipation in December. The first phase of the wind power and PV large base project has initiated construction, while a number of other projects are expected to postpone their installations. Adding the 331 installation rush from the overseas markets such as India, Japan, and Poland to the contributing factors, the 2022Q1 demand will continue to improve, whereas the Chinese New Year stocking demand has also slightly propelled order popularity. Leading module makers have now reduced their inventory to within one month, as well as marginally increased the operating rate.
As for auxiliary materials, glass quotations remained temporarily robust this week, with no apparent fluctuations in market activities. A number of businesses are starting to enter overhaul for their production lines, which slightly lowered the output under an insignificant impact. 3.2mm and 2.0mm glasses were maintained at approximately RMB 25-26/㎡ and RMB 19-21/㎡ respectively this week.
（Image：pixabay）
