Major Taiwanese solar cell makers keep high production utilization rate at 92-103% in 1Q14 and down to 62-72% in 2Q14 mainly drop in May and in June, because US anti-dumping investigation seems to affect Chinese solar panel makers to push in cell purchasing earlier to Feb-Apr from the rest of 2014.
Major Taiwanese solar cell makers keep high production utilization rate at 92-103% in 1Q14 and down to 62-72% in 2Q14 mainly drop in May and in June, because US anti-dumping investigation seems to affect Chinese solar panel makers to push in Taiwanese cell purchasing earlier to Feb-Apr from the rest of this year. At this moment, because solar panel demand in the US and Japan still maintains strong, major Chinese solar panel makers are still to purchase Taiwanese solar cells in Jan and plan to build up the inventories by the end of April. On the other hand, Japanese solar panel makers would like to adjust their panel inventories before the annual financial result end in March 31st so as to reduce their cell procurement to Taiwanese cell makers in 1Q14. Beside the demand drop in Japan, Chinese solar panel demand seems also has shown the demand in drop in Jan and in Feb, due to China domestic market slow down. With the inventories building to US market, Taiwanese cell makers are still able to keep their high production utilization rate before the end of April. However, major industrial professionals are expected to see US ITC will release if the investigation of anti-dumping and anti-subsidy against Taiwanese cells will be issued or not. In 2Q14, solar cell demand is likely to be slow down, because the market is slow down in China, Japan, and India. After the end of April, PVinsights expect that Taiwanese cell makers will reduce 40-50% their production utilization rates or orders, because Chinese and Japanese cell order cuts.
Sharp, on Jan. 23 2014, said it would stop producing solar panels in Memphis, Tennessee, the United States by the end of March, following the announcement the plans to cease production of solar panel in its 500MW facility in Wrexham, North Wales in February 2014. This implies Sharp will be on schedule to shift their cell OEM orders from Taiwanese cell makers to Chinese ones. According to the announcement made on Jan 23rd, The U.S. solar panel factory shutdown would cost about 300 jobs, or two-thirds of the workforce, at a Sharp plant in Tennessee.
Sharp plan to shift 750-900MW of cell purchasing from Taiwanese cell makers to Chinese cell/panel makers in 2014 for the further cost reduction. Although some Taiwanese cell makers would like to evaluate module manufacturing service to Sharp, it is too late to change Sharp mind. Furthermore, Sharp is planning to keep 500-600MW cell procurement to Taiwanese cell makers in 2014. However, Sharp thinks that Taiwanese cells must be shipped to China to be assembled into solar panels. The extra shipping cost from Taiwan to China and Taiwanese cell price premium make Taiwanese cells less cost competitive. In order to have the further cost reduction, Sharp will continue to reduce the purchasing quantity to the cells made in Taiwan in the future.
In 2013, Sharp had placed their outsourcing manufacturing with total 1.2GW to 1.5GW to Gintech, NSP, Motech and TSEC. According to PVinsights market research, in 1Q14, Sharp had cut their monthly OEM orders from 120-140MW to 40-50MW in total to Taiwanese cell makers. There is one reason to tell why some major Taiwanese cell makers reported NTD sales revenues MoM dropped in Jan with NTD depreciation against US dollar.