May Module Price Decline Worsens Due to Weak Demand [SMM In-Depth Analysis]

According to SMM, recent domestic prices for distributed and centralized PV modules have seen an expanded decline. The spot transaction price for distributed TOPCon modules (182mm) has dropped to 0.689 RMB/W (tax and shipping included), while forward module prices have fallen below 0.65 RMB/W (tax and shipping included), with a continued downward trend. Meanwhile, the transaction price for centralized TOPCon modules (182mm) has decreased to 0.701 RMB/W (tax and shipping included), creating an inverted price relationship with distributed modules. This downward trend, which began in early April, has resulted in an 11.67% decline in module prices from their peak, positioning the module segment in a relatively advantageous spot within the industry chain.

【This Price Decline is Driven by Demand, Not Supply】

SMM data shows that the April price drop across the entire PV industry chain started at the module level and gradually propagated upstream. However, in terms of overall decline, upstream segments (industrial silicon and wafers) saw significantly steeper drops than downstream cells and modules. The root cause lies in supply-demand dynamics. Rough estimates indicate that industrial silicon and polysilicon inventories cover 3-4 months, wafers about 1 month, while cells and modules have less than 1 month of inventory. Inventory turnover directly reflects supply-demand balance, which is why wafers experienced the steepest decline—over 20%—in this downturn.

While the current price levels are similar to the November 2023 low, the underlying dynamics differ:

1. Industry-wide price declines are occurring alongside noticeable cost reductions across all segments.

2. Although margins have turned from profit to loss since the April peak, most players can still cover cash costs—a key reason why large-scale production cuts have not yet occurred.

Additionally, specialized manufacturers hold a competitive edge in this downturn. SMM’s module cost index shows:

• Integrated manufacturers' production cost: 0.722 RMB/W

• Specialized manufacturers' production cost: 0.668 RMB/W
  The cost inversion is widening, meaning integrated players must adopt more proactive strategies to remain competitive.

Medium-to-Long-Term Outlook: Module prices are expected to continue falling. A quick stabilization in May-June appears unlikely, with potential demand recovery only after July. Post-5/31, domestic demand may not collapse but a significant portion of module orders—unable to meet grid-connection deadlines—will likely be canceled, further weakening near-term demand expectations.

Macro Policy Impact: This price volatility stems from the 5/31 deadline and Policy Document No. 136, which aims to reduce electricity costs for energy-intensive industries. While the short-term demand gap brings pain, the key question is whether lower power costs can reignite demand. Recent policy implementations in Jiangsu, Shandong, Inner Mongolia, etc., reveal intensifying competition in distributed PV, including mandatory self-consumption ratios.

Future Trends: The fundamental logic of PV will be reshaped. Market-oriented reforms will spur fiercer—yet healthier—competition, driven not by cutthroat price wars but by technological innovation and product upgrades.