Polysilicon prices have continued to climb in China amid limited supply as manufacturers are hit by power rationing.
The average price for polysilicon in the country reached RMB273.1/kg this week (US$40.73/kg, inclusive of China’s 13% sales tax), a 1.71% increase week-on-week, according to the silicon branch of the China Nonferrous Metals Industry Association. Media reports suggest the latest price represents an 11-year high.
One polysilicon producer reduced output this week due to power rationing, while another had an unplanned shutdown, the association said.
“The polysilicon prices are so high because demand is strong and supply is limited”, said Jenny Chase, head of solar analysis at research organisation BloombergNEF, adding that there was also a short-term effect from an accident in a factory last week, though this “is expected to be minor in the annual context”.
Citing information from the China Nonferrous Metals Industry Association, Johannes Bernreuter of polysilicon research firm Bernreuter Research said Xinjiang GCL, Daqo and East Hope are planning maintenance in July, meaning polysilicon production will be flat month-on-month, far lower than the association’s original forecasts.
Research published yesterday by industry analyst PV InfoLink noted that there have been “ceaseless price hikes” in Q2, as it said the polysilicon shortage “shows no sign of easing”.
This year has seen polysilicon producers including Tongwei, Zhonghuan Semiconductor (TZS) and Daqo New Energy announce plans to scale up production, although Daqo effectively sold out its inventory for 2022 after signing a long-term supply deal.
Chase said that polysilicon prices should fall in Q4 of this year as more production capacity comes online.