Daqo drives polysilicon production costs down to industry record US$5.86/kg

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn
Share on reddit
Reddit
Share on email
Email
The company noted that the significant cost reduction in such a short period was due to the growing economies of scale as polysilicon production also reached a record 19,777MT (metric tonnes) for the quarter as it reached full production of its Phase 4A capacity expansion project. Image: Daqo

China-based high-purity polysilicon producer Daqo New Energy has reported that in the first quarter of 2020, the average total production cost of polysilicon was reduced to US$5.86/kg, down from US$6.38/kg in the previous quarter, a new industry record. 

The company noted that the significant cost reduction in such a short period was due to growing economies of scale, as polysilicon production also reached a record 19,777MT (metric tonnes) for the quarter. The quarter also saw Daqo attain full production of its Phase 4A capacity expansion project.

Also contributing to the record were low production costs. Production process were further optimised, with those said to have exceeded original expectations. This included a per unit electricity usage reduction of approximately 7% compared to the previous quarter and a reduction of approximately 10% as compared to the prior year period, according to the company. 

Daqo New Energy has reported that in the first quarter of 2020, the average total production cost of polysilicon was reduced to US$5.86/kg, down from US$6.38/kg in the previous quarter, a new industry record. Image: Daqo

However, expectations of further polysilicon production cost reductions in the second quarter of 2020 are highly unlikely.

Due to demand constraints brought on by the COVID-19 pandemic creating ASP (Average Selling Price) pressure across the sector, Daqo’s polysilicon ASP averaged US$8.79/kg in Q1.

Daqo's major customers such as LONGi Green Energy and JinkoSolar have also significantly reduced polysilicon inventory due to global demand issues, according to the company.

As a result, and industry practice, annual production maintenance for part of its major Xinjiang facility will be undertaken in Q2. However, with capacity at record highs, facility maintenance is to be enacted in phases. 

Daqo only expects to produce approximately 13,500MT in Q2 and sell in the range of14,500MT to 15,500MT in the quarter. Therefore, production costs are expected to be higher as economies of scale will be lower.  

1 December 2021
Join this virtual conference on 1-2 December 2021 for expert presentations covering PV Module Technology, Supply & Site Optimisation for Utility-Scale. Delegates can access streamed presentations, session recordings and chat/messaging tools to connect with fellow delegates and speakers. Speakers include leading developers, manufacturers, testing and research institutes, including: NREL, Silicon Ranch, Sonnedix, Heliene, Powertis, LONGi Solar, JinkoSolar, PVEL, Risen Energy, Seraphim, STS, Trina Solar, Eternalsun Spire, QEERI, Fraunhofer, Estuary Capital Partners and VDE

Read Next

PV Tech Premium
November 26, 2021
Average market prices for 182mm solar wafers fell by nearly 7% this week, falling to levels not seen in almost two months, however other material and component costs have remained high.
November 24, 2021
The US International Trade Commission has recommended that the Section 201 safeguard tariffs on solar cells and modules be extended.
November 24, 2021
Solar manufacturing leader LONGi Solar has signed a two-year wafer supply deal with Chinese PV manufacturer DAS Solar which could be worth up to US$1.1 billion.
PV Tech Premium
November 19, 2021
In recent years the solar industry has seen some of the largest and cheapest contracts awarded in the MENA region. But with concerns over component price and availability, what can the industry expect from the solar sector in the MENA region in the medium-term?
November 19, 2021
JA Solar has revealed plans to build a 5GW module assembly plant in Chaoyang City, Liaoning Province.
November 19, 2021
Canadian Solar has warned of solar cell overcapacity next year, slamming the breaks on its own cell manufacturing expansion plans while accelerating on its module assembly roadmap.

Subscribe to Newsletter

Upcoming Events

Solar Media Events
December 1, 2021
Solar Media Events
February 1, 2022
London, UK
Solar Media Events
February 23, 2022
London, UK
Solar Media Events
March 23, 2022
Austin, Texas, USA
Solar Media Events
March 29, 2022
Lisbon, Portugal