SHANGHAI, Jan 17 - The polysilicon market has experienced choppy movement recently.  According to SMM data on January 16, the domestic polysilicon transaction prices have risen to 160-170 yuan/kg recently. It is learned from industry insiders that the price rally was mainly driven by upstream producers’ reluctance to sell after the prices slumped into oversold territory. It is expected that there is still upside room before downstream demand recovers in March.

According to SMM reports, three top-tier polysilicon companies began to hold back their cargoes following drastic price drop, and others followed suit.   

Optimism about the post-CNY market encouraged major polysilicon producers to hold back from selling. Previously, the collapse of silicon wafer prices spilled over into upstream polysilicon prices.  

In terms of downstream demand, as the inventory of silicon wafer companies fell and their operating rates increased, the positive impact was transmitted to upstream polysilicon. CNY stocking and dip buying after steep price fall drove up operating rates of silicon wafer companies to varying degrees. 

The operating rates of silicon wafer companies will gradually return to normal levels after the CNY holiday. It was reported that the current overall inventory of polysilicon was about 100,000 mt. 

PV power stations usually start to solicit bids after the Chinese New Year, which may shore up polysilicon prices. 

However, many analysts believe that the rebound in polysilicon prices will be short-lived, and the general direction of upstream price cuts will not change in the long run. One analyst believes that the price level of polysilicon this year will be between 120-150 yuan/kg, and may reach 180 yuan/kg under optimistic scenario, depending on upstream price control measures.