SUN PRICES SETTING

Polysilicon Price Trending down to $50/kg due to High Inventory Level and Low Visibility of Market Demand.
May 25, 2011 (EnergyTrend via Mercom Capital)

"…[M]arket demand [has] yet to pick up…[I]nventory still remain[s] at a high level. As a result, the polysilicon price has significantly dropped. The average spot price of polysilicon has decreased by over 10%...to below $60/kg…[and] the average price of [a] solar cell has decreased [0.84%] to below $0.95/Watt [considered manufacturers’ maximum tolerance]. Manufacturers indicated that the market’s confidence is as low as the financial meltdown in 2008.

"…[T]he polysilicon price has come to 52/kg at the lowest, and the average polysilicon price has quickly decreased by 12.71%, to $58.875…[P]olysilicon manufacturers are…[struggling] to survive…Si wafer manufacturers are also under price pressure. The average price of multi-Si wafer[s] and mono-Si wafer[s] [have]…fallen by 9.87% and 6.08%, to $2.42/piece and $2.8/piece…"

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"…[D]ue to low demand in the module market, the average price of module[s] has continued to decrease by 3.27%, to $1.36/Watt…[T]he average price of thin film has decreased by 3.21%, to $1.055/Watt…[And] the average price of PV inverter[s] has fallen by 5.06%, to $0.244/Watt…[I]nventory turnover is still the key factor for the PV market demand recovery. Cumulative ready-for-sale inventory in Italy is around 3.5GW, and 1.5GW~2GW in other regions…[I]nventory problems also exist in the polysilicon, wafer and solar cell fields.

"EnergyTrend estimates that it will take 1-2 months to digest the total inventory in stock…Apart from high inventory level[s], many countries have curtailed feed-in tariff policies, which resulted in a decreasing IRR ratio. Therefore, EnergyTrend believes…market demand [will] not recover in the short run."