Every year, the period that follows the Chinese New Year is unstable for the industry. This year, the holiday period was from January 21st to 27th. Before the holidays, we already witnessed price increases for upstream materials like polysilicon or components. This trend continued this year when all factories and manufacturers resumed work. Some consider that the increase in prices this week is the cumulative increase in two weeks, considering that nothing happened last week. Others believe that this is a one-week fluctuation, a sign of a longer-term trend. We have prepared a PV industry price report to get up-to-date information about the trends in February 2023.
PV Industry Supply-Chain Price Trends (February 2023)
POLYSILICON
The polysilicon price increase that started end of January has continued in February. This week, when the entire industry resumed work, we witnessed a sudden 18% price increase on average, reaching RMB 178/kg.
Figure 1 – Polysilicon price (kg) (Source: Infolink-Group)
Many wafer factories have waited until after the Spring Festival to start ordering a large quantity of silicon, which is why the current price is in line with the market situation. Empty inventory following the holiday period has led to a large procurement demand. According to China Silicon Industry, the supply/demand relationship is fragile, and downstream procurement might support the price increase in the coming weeks.
Additionally, some of the new production capacities of silicon that were expected now are still not in production. The additional output is not enough to meet the new demand (5,000 tons of new output for 10,000-15,000 of new demand).
WAFER
Figure 2 – Wafer price (PC) (Source: Infolink-Group)
Prices of both M10 and M12 wafers have risen this week. Polysilicon price increase pressure has been transferred to the wafer. As prices are expected to keep increasing because of short supply in February, negotiations are now at a dead end. Manufacturers prefer to keep stock so the wafer supply is very tight at the moment.
CELL
Figure 3 – Cell price (w) (Source: Infolink-Group)
The wafer price trend has impacted cell prices, which have increased this week. M12 cells are now exchanged for USD0.130-0.200/W, and M10 cells for USD0.130-0.131/W. Cell demand is high because of module market popularity but the wafer tight supply restricts the production of cells.
For this reason, we can expect a stabilization of cell prices this month, but no decrease in a short-term period.
MODULE
Figure 4 – Module price (W) (Source: Infolink-Group)
The upstream price trend has impacted the module manufacturers, who had to adjust their prices. But the increase is less than what was witnessed for silicon, wafer, and cells. Some module manufacturers still have stock from before, which means they can still be profitable without impacting too much their prices.
But as demand is going to get bigger in February, the remaining stock will have to be replaced with new products so the overall market price will rise and follow the upstream inflation.
Freight Cost Trends (February 2023)
Recently, freight rates didn’t have volatility. The costs have stayed steady for most of the international destinations.
Figure 5 – Freight cost, update on February 2nd （Source: FBX Global Container Freight Index）
The season of installations and projects will start again soon in many regions of the world, which means the demand is going to get bigger in a short period of time. It will impact not only the prices but also the delivery time and availability of products. We advise you to anticipate this period to be sure to get your products on time.
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