The First Wave of Glass Furnace Restarts Begins, Supply-Side Risks Increase Amid Improving Market Conditions [SMM Analysis]

SMM February 20 News: Since returning from the Chinese New Year, the trading volume in the PV glass market has increased significantly. With the anticipated improvement in demand from the module sector, coupled with the expected tight supply of glass, module manufacturers have shown a substantial increase in purchasing willingness. Glass prices are also likely to rise. Amid the market recovery, previously sealed glass kilns have recently resumed capacity, reaching nearly 2,000 mt/day, with a continued upward trend expected.

Figure: Statistics on Sealed PV Glass Kilns in 2024

Data Source: SMM

Supply side, as of now, February's domestic glass production schedule remains slightly above 40 GW. Currently, nearly 900 mt/day of sealed kiln capacity has resumed in Anhui, approximately 500 mt/day in Fujian, and around 500 mt/day in Guangxi. Additionally, over 1,000 mt/day of sealed kiln capacity is expected to resume operations domestically in the future.

Therefore, although there is an expectation of supply tightening in the glass market, and with module production schedules increasing in March, destocking performance is expected to strengthen, leading to a potential rise in glass prices. However, under the price increase expectations, the recent acceleration in kiln capacity recovery has had relatively small short-term impacts on the supply side. Nevertheless, after the rush for installations in end-use demand concludes, the module production schedule may once again face the risk of a supply surplus.