Upstream Transactions Remain Flat with High Quotations Maintained; Weak Volume and Price for Modules [SMM Weekly Review]

Polysilicon: This week, the mainstream transaction prices for N-type recharging materials were 39-45 yuan/kg, and for N-type dense materials were 38-42 yuan/kg. Polysilicon prices rose slightly this week, mainly reflected in the continued increase in quotations for N-type recharging materials. However, it should be noted that the latest quotations have seen only limited transactions, with weak market representation. Mainstream downstream order-signing enterprises remain in a wait-and-see mode. Polysilicon production in January is expected to continue declining, involving production cuts at 2-3 enterprises, with production expected to decrease by 3,000 mt.

Wafers: This week, domestic N-type 18Xmm wafers were priced at 1.1-1.18 yuan/piece, N-type 210R wafers at 1.2-1.35 yuan/piece, and N-type 210mm wafers at 1.42-1.55 yuan/piece. Prices for all wafer sizes increased this week, mainly reflected in higher quotations. Sentiment for raising quotations was consistent, and wafer manufacturers refrained from offering low prices for new orders, while historical low-price orders were still being delivered. Wafer enterprises saw profit recovery, with two additional integrated enterprises planning to increase production this week. However, the extent of production increases before the Chinese New Year will depend on subsequent worker recruitment.

Solar Cells: This week, prices for various Topcon solar cells generally increased, with top-tier enterprises leading the gains and second- and third-tier enterprises following suit, resulting in a widened price spread. This was mainly driven by pre-holiday stockpiling by module enterprises, boosting demand for solar cells. Prices for Topcon 183 solar cells (efficiency of 25% and above) were around 0.285-0.295 yuan/W, Topcon 210RN solar cells at 0.285-0.29 yuan/W, and Topcon 210 solar cells at 0.285-0.295 yuan/W. On the supply side, some manufacturers with holiday plans have gradually reduced or halted production, leading to a decline in weekly production.

Modules: In the current module market, mainstream transaction prices for centralized projects were as follows: PERC 182mm at 0.63-0.68 yuan/W, PERC 210mm at 0.64-0.69 yuan/W, N-type 182mm at 0.64-0.69 yuan/W, and N-type 210mm at 0.65-0.7 yuan/W. Mainstream transaction price ranges for centralized projects remained stable. However, due to the off-season, transaction prices in the spot market for some enterprises declined. With the arrival of the Q1 off-season, enterprises are producing based on sales and focusing on selling inventory. Recently, some enterprises have further reduced operating rates or shut down production lines, and January's actual production is expected to decline further compared to forecasts.

End-User: During the week of December 30, 2024, to January 5, 2025, SMM statistics showed that domestic enterprises won bids for 36 PV module projects, with winning bid prices concentrated in the range of 0.65-0.67 yuan/W. The weighted average price for the week was 0.67 yuan/W, down by 0.09 yuan/W compared to the previous week. The total procurement capacity of winning bids was 642.57 MW, a decrease of 1,487.14 MW from the previous week. Entering 2025, ground-mounted power station projects have entered a rest period, with progress slowing. Before the Chinese New Year, there was a rush to install residential projects, maintaining demand for module procurement, while the commercial and industrial sectors appeared relatively weak. Overall, Q1 remains a domestic off-season for demand, with limited installations expected before and after the holiday.

Encapsulation Film: This week, prices for EVA transparent film were 12,600-13,000 yuan/mt, EPE co-extruded film at 15,000-15,300 yuan/mt, and POE film at 17,800-18,100 yuan/mt. PV-grade EVA transparent film faced significant pressure, with some production lines already shut down. Next week, small and medium-sized enterprises will gradually begin their holidays, while large enterprises will maintain partial production at some bases during the Chinese New Year.

EVA/POE: Prices for PV-grade EVA were transacted at 10,350-10,700 yuan/mt, while POE transaction prices were 12,000-13,800 yuan/mt. The EVA market experienced tight spot availability, coupled with rising logistics costs, leading to a slight rebound in quotations. PV-grade POE prices remained stable.

PV Glass: This week, quotations for PV glass remained temporarily stable, with prices for 2.0mm back glass slightly increasing. As of now, mainstream quotations for 2.0mm single-layer coating glass were 12.0 yuan/m², and for 3.2mm single-layer coating glass were 19.5 yuan/m². The domestic PV glass market this week saw intense bidding and negotiation sentiment. January glass prices have not been fully finalised, with upstream and downstream enterprises primarily engaged in negotiation. Leading module enterprises adopted a strategy of shipping first and pricing later. On the supply side, reductions were significant this week, with cold-repair furnace capacity reaching 2,800 mt/day, and an additional 1,650 mt/day capacity shut down for furnace maintenance. Domestic glass supply is expected to decrease significantly. However, due to reduced production schedules by module enterprises during the Chinese New Year holiday, the domestic glass supply-demand balance remains in a surplus phase. Fortunately, some module enterprises have started stockpiling slightly in January, leading to higher-than-expected trading volumes, though the overall market still shows a slight surplus. For price forecasts, glass prices in January are expected to remain stable. Although demand has weakened significantly, reduced supply provides emotional support. Additionally, glass enterprises, facing prolonged losses, have a strong sentiment to stand firm on quotes. Therefore, mainstream transaction prices in January are expected to remain stable. However, some enterprises with high inventory levels may lower quotations to facilitate sales, with low-price transactions expected to increase compared to December.

High-Purity Quartz Sand: This week, domestic high-purity quartz sand quotations increased slightly. Current market quotations are as follows: inner-layer sand at 65,000-75,000 yuan/mt, middle-layer sand at 35,000-45,000 yuan/mt, with high prices increasing by 5,000 yuan/mt, and outer-layer sand at 19,000-25,000 yuan/mt, with prices temporarily stable. At the beginning of the week, leading domestic sand enterprises raised quotations, with inner- and middle-layer sand prices both increasing by 5,000 yuan/mt. After the price hike, market response was mediocre. Recently, the supply of imported semi-finished ore has increased, coupled with accelerated adoption of some substitutes, leading most crucible enterprises to remain in a wait-and-see mode with low purchasing willingness. Future purchases are expected to focus on price negotiations. On the demand side, crucible enterprises are planning to begin holiday shutdowns, resulting in a short-term decline in demand. Although wafer production schedules have recently increased, crucible enterprises are primarily selling inventory, with limited willingness to increase operating rates. For price forecasts, domestic quartz sand quotations are expected to rise with increased demand and reduced supply. However, transaction prices are likely to remain stable due to high inventory levels.

PV Backsheet: This week, PV backsheet market prices remained stable at low levels. Prices for white CPC backsheet with dual fluorine coating were around 4.8-5.3 yuan/m², and for transparent CPC backsheet with dual fluorine coating were around 11.3-12.3 yuan/m². As the Chinese New Year approaches, overall January backsheet market demand is extremely weak. On one hand, downstream module demand is very sluggish as the holiday nears. On the other hand, with the continuous contraction of the single-glass market, backsheet market demand continues to shrink. According to feedback from various enterprises, January backsheet market orders are expected to decline, with only a few overseas production lines reporting slight order recovery due to traditional pre-holiday overseas stockpiling. Other domestic backsheet manufacturers reported declining orders, with some enterprises expecting production schedules to drop below 1 million m².

Currently, the domestic backsheet market's January operating rate is expected to fall below 10%, remaining around 8%, reflecting extremely sluggish industry operations. Furthermore, some module manufacturers have indicated plans to phase out single-glass module capacity in 2025, suggesting further declines in backsheet market demand. The industry's outlook remains bleak.

Inverters: This week, inverter price ranges were as follows: 20kW at 0.12-0.16 yuan/W, 50kW at 0.11-0.15 yuan/W, 110kW at 0.1-0.14 yuan/W, and 320kW at 0.09-0.11 yuan/W. On the supply side, production remained stable and sufficient, while overall demand sentiment was mediocre, with large-power string and centralized models seeing higher shipments.

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