Although thin holiday trading limited the scope of decline, the polysilicon prices remained under pressure amid demand weakness and RMB depreciation. Polysilicon prices has been pulled back from highs earlier this year as unexpected cut in multi-crystalline wafer production raised worries that weak global demand could hike price competition more severely more than initially expected. Moreover, since Chinese polysilicon become sufficient in supply as suppliers retrieve their full productions, distorted balance of supply and demand kept polysilicon prices under increasing pressure. In addition, another key factor in the drop of polysilicon price this week was the depreciation of RMB. HMeanwhile, in overseas market, polysilicon prices continued on a clear price downtrend following the collapse of Chinese polysilicon prices. Since major buyers took conservative approach in terms of procurement amid waning demand, decreased order visibilities have triggered further price reduction in the overseas market.
Due to quite activities during the Chinese New Year holidays, both multi- and mono-crystalline wafer prices were only slightly lowered than previous week. Nevertheless, the fundamental weakness remained intact. The prospect of demand weakness forcing the wafer buyers to reduce the pace of procurement, and the threat of a widening margin losses for 2nd and 3rd tier multi-crystalline wafer makers lead to a significant production cut. However, since the top multi-crystalline wafer makers still continued to operate in high utilization rates, the production cut efforts made by other 2nd and 3rd tier peers were eroded as the oversupply situation persist. The mono wafer has been weighed down by a variety of factors this year, including concerns that major suppliers pursue an aggressive expansion strategy and the perceived erosion of its margins as downstream mono cell makers scaled back utilization rates amid weak demand. Outside China, due to solar wafer demand weakness, higher price than that in China, and downstream solar cell price drop, average mono-crystalline and multi crystalline wafer prices were pulled down along with the price downtrend in China.
The average prices for both multi-crystalline and mono-crystalline cells dropped limitedly this week amid thinning trading in Lunar New Year. Yet, the downward pressure on pricing remained amid waning demand. Although some 2nd tier solar cell makers lowered production rates in February, overall market was still hard to rebalance as some top tier Chinese cell makers with better cost structure still operated at high utilization rates. Moreover, some Chinese and Taiwanese solar cell makers started to pile stocks as they anticipated for the demand recovery after the Lunar New Year. However, the persistent oversupply nature would still hard to overturn in the short term, and with recent retreat in Chinese Yuan, the multi-crystalline cell prices continued on the downward track. As for mono-crystalline cells, sentiment did not see to have clear recovery as concerns that mono suppliers' plans to cut prices still not won buyers' appetite as quickly as expected. Moreover, with subdued demand in emerging countries and lowered tolling for mono-crystalline cells, average price of mono-crystalline cells continued to lower, but the scope was also limited by the holiday lull.
Overall module prices were traded slightly lower this week amid weakening CNY and thinning trading. As the global demand prospects remained dimmed, more module makers were employing price reduction strategies in order to secure orders within Japan, EU, and emerging countries, since some Chinese 2nd tier players stirred the price competition in EU, Japan and emerging countries. However, with recent weakness of dollar, the downward price trend in EU and Japan was somewhat offset as the prices were translated to flat to slightly lowered in USD term. Solar panel prices in China dropped slightly in USD term due to the depreciation of RMB and light holiday trades. In US, solar panel prices retreated from highs as major Chinese module makers offered competitive pricing in order to digest module inventory that was shored up in 4Q17. On the other hand, solar panel prices in India was relatively stable against that in other regions as more buyers rushed to secure the supplies before the fiscal year end. Overall, due to the light trade during Lunar New Year holiday and the weakening dollar in the recent, the drop of global solar panel prices were limited in this week.