Polysilicon price will continue to decline to $50/kg by the end of 2009 and further to $40/kg next year due to deteriorating oversupply and continued inventory de-stocking. Due to the relatively low entry barriers and cost reduction along the rest of the manufacturing process, module price could decline to $1.6/Wp before end of FY10.
The only way for the China solar industry to find a demand supply balance would be for the polysilicon price to drop to a level so that high cost producers temporarily shut down capacity or reduce capacity utilization. Therefore, for the polysilicon price to stabilize at $70/Kg will require a total solar demand of 15GW next year. Even if there is an unexpected positive policy response over the next 12 months, we believe an end demand of 15GW is far too optimistic. So polysilicon price declines must continue.
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2 comments:
Nice assessment. I would say about 7GW next year (which would be about a 50% jump for shipments vs. this year). Poly oversupply to persist until 2012-2013 until excess capacity is taken off the market as the higher cost producers eventually cannot compete with Tier 1 cost positions. By that time, maybe solar demand would hover around 15-20GW/year which would then re-create another rush to build new poly plants. It is but a cycle.
thanks for the comment
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