Global polysilicon prices accelerated in August

According to information released by the US market research company IHS iSuppli, global PV polysilicon prices accelerated in August, and there is no sign of a weak supply. It is recommended that first-tier suppliers consider reducing production to stabilize the market.

It is reported that the global PV polysilicon price fell faster in July than in July, continuing the downward trend that began in the fourth quarter of 2011.

In August, the contract price of 9N polysilicon and higher grade polysilicon was $27.8 per kilogram, while the price of the same grade polysilicon in the spot market was much lower, at $21.9 per kilogram. Due to the rapid decline in spot prices, the price gap between the two is widening. The contract price for 6N~8N polysilicon is $22.7 per kilogram, while the spot market price is $20.1 per kilogram.

Analysts said that oversupply is still the main trend affecting the photovoltaic polysilicon market.

A worrying issue is that its price is affected by many factors, including a sharp drop in demand for solar modules in August, high channel inventory in Europe and the United States, and China's anti-dumping tariffs on international manufacturers. IHS iSuppli believes that in order to stabilize polysilicon prices, first-tier suppliers must consider reducing production.

Looking ahead to the polysilicon market outlook in October, IHS iSuppli believes its demand may pick up. However, the upcoming trade war with China has brought uncertainty to the market and may scare off some buyers. If these pressures continue to exist, demand in October may be weak, putting more pressure on polysilicon suppliers around the world.

In view of China's anti-dumping actions, its price trend is not certain. If China's Ministry of Commerce implements corresponding punitive tariffs on South Korea, the European Union, and US polysilicon producers in the next three months, these companies will be forced to accelerate price cuts because China is a major polysilicon buyer.

Although first-line polysilicon manufacturers reduced capacity utilization in August, their production is still high. In addition, the resale of polysilicon supply remains sufficient. If first-tier suppliers maintain a high level of capacity utilization, the excess supply of polysilicon will continue for 12 months.

IHS iSuppli believes that, given the margins of suppliers, the first-tier polysilicon suppliers should seriously consider reducing production. According to the market dynamics in July and August, and the forecast for September, the profit and loss of major polysilicon manufacturers in the third quarter of this year is expected to be worse than the second quarter.

In August, global demand for polysilicon was very low, and trading volume was at least 10% to 15% lower than that in July. This is having a major impact on the spot polysilicon market as buyers still have to fulfill long-term agreements with major suppliers, although some buyers try to keep the quantity to a minimum. This is another reason why first-line suppliers should consider reducing production in the future.

August is also the off-season demand for crystalline silicon modules in Europe. At the other end of Eurasia, Chinese demand may rise, but still have to wait.