PV product prices rebounded across the board, future price forecast

With the end of the holiday season, market demand is gradually picking up, and silicon and wafer prices have come out of a deep "V" upward trend, as shown in the chart below. According to the silicon material price data released by the China Silicon Industry Association, the price of monocrystalline silicon re-injection material rose to $32.5/kg this week, a 31% increase from the previous week. This week's cell prices rose to about 14%, for which we see this rise as a value repair for PV products.

This week, the price of PV auxiliary materials also rose. On January 31, a photovoltaic film (EVA) companies issued a "price adjustment notice letter" said that due to the recent EVA raw material prices continue to rise, resulting in increasing costs of the company's products, the company decided to start the EVA film on the basis of the original price increase of 10 percentage points.

In 2023, the global demand for PV development is still very strong, and orders from major PV module companies rose sharply in February and March. The huge demand has kept module prices in a reasonable price range, even in the run-up to the sharp drop in silicon prices.

This price increase for silicon wafers is mainly due to the extremely tight supply of silicon wafers. According to some cell companies, silicon wafers are currently in short supply! Tight silicon wafer supply is mainly caused by the following reasons.
(1) Due to the sharp drop in wafer prices, wafer companies have significantly reduced their inventories, resulting in wafer inventories below normal levels.
(2) Due to the dramatic price changes, silicon turnover is very small, after the Chinese New Year holiday digestion, resulting in the current silicon wafer enterprises generally lack of silicon production, silicon output is lower than expected.
3) Currently, silicon offers have increased to more than $32/kg, and due to price instability, silicon turnover is still low! Even if there is a deal immediately, it will take 2~3 weeks of production cycle for silicon material to be produced into wafers.
4) Strong downstream demand, resulting in a significant increase in demand for upstream cells and wafers. Due to the shortage of silicon wafers in the upstream, resulting in a tight supply of cells, cells have risen from a low of $0.11/W all the way to $0.14/W years ago.
As you can see, the downstream demand is up, but the upstream needs a production cycle. Therefore, it is expected that throughout February, silicon wafers will be in a tight supply situation, which will be gradually eased only in early March.
Later, with the release of silicon production capacity and the increase in the start-up rate of silicon wafer enterprises, industry supply and demand will gradually balance, and prices will stabilize at the general acceptance of the end demand on the component side of the price.