Expectations of market conditions improving in 2013 are likely to result in polysilicon prices within the solar industry rebounding slightly, according to the latest analysis from market research firm IHS.
However, prices for 9N solar polysilicon fell by over 9% in October, according to IHS, while long-term agreements (LTA) only declined by 1% in the same period.
Pricing for the 6N to 8N grade polysilicon followed the higher purity material with a fall of 7%. However, the contract segment for the lower purity materials was said to have fallen by more than 8% in the same time period.
Glenn Gu, senior analyst, photovoltaics, at IHS said, “Worldwide polysilicon demand decreased in October, with reduced shipments on both the contract and spot markets. Not only did overall shipment volumes in October fall by 14% from the month before, supply levels and inventories also decreased in October as second- and third-tier Chinese suppliers reduced production. Still, these manufacturing cuts weren’t sufficient to bring supply in balance with demand.”
According to the market research firm, November pricing levels are expected to continue to fall, yet a rebound could potentially start in December this year or January time frame, next year.
The rise is not expected to be significant, but IHS believes the increase could be as much as 2.4% for lower grade material. Pricing for 9N material could be flat, though it does mark a temporary halt to price declines that have been persistent over the last nine months, IHS said.
“Suppliers are trimming production, inventories in the channel are continuing to be depleted and most industry players are expecting a rebound in demand in 2013,” added Gu.
However, the analyst believes that spot market prices will remain below those of LTAs, though these will trend downwards accordingly until supply/demand balance is restored.
But that likelihood is perceived to be down the road as Gu expects pricing to continue to decline later in 2013.