October 15, 2013—According to EnergyTrend, a research division of TrendForce, the intensive pricing competition in the PV market has gradually come to an end. Due to the increased demand in the emerging markets, solar system demand in 2014 is likely to rise substantially. As indicated by EnergyTrend’s data, deducting the amount of solar system installations which haven’t completed grid-connection in 2012, the total amount of grid-connected installations is likely to reach 28.6GW in 2013. As for the total amount of shipment in 2013, it will be around 33.3GW, which shows that the overall supply within the PV market can be somewhat sufficient. Although the total amount of module shipment may be about 40GW in 2014, the actual amount of grid-connected installations will only be around 39.5GW. Module supplies, therefore, may be somewhat restricted.
The oversupply situation in the global PV industry within the past few years have led to the decreased polysilicon price. Since most of the new manufacturers continue to suffer from losses, they have suspended production line operation successively since the second half of 2012, which caused global polysilicon capacity to continue to decline. However, market demand may increase in 2014. As it may take about a quarter to get the polysilicon production line restarted, EnergyTrend believes that polysilicon supply may be restrained or even become insufficient in 1Q14.
As indicated by EnergyTrend’s data, global polysilicon output is around 0.17 million tons in 2013, which represents 31GW of supply. The average quarterly supply is between 7GW-8GW. Looking into 1Q14, EnergyTrend estimates that demand of silicon wafers will be around 8GW. But based on current output, polysilicon supply is around 0.04 million tons, which is 7.2GW of supply. On the other hand, manufacturers are still optimistic about the demand in 4Q13 with current shipment condition remaining normal. In addition, it’s projected that inventory level will remain the same. According to the current condition, EnergyTrend believes that polysilicon supply may become more restricted in 1Q14.
EnergyTrend indicates that whether the supply shortage can be solved or not will have to depend on the following variables: how fast Chinese polysilicon manufacturers can restart the production, new production capacity status (e.g. Hanwha, Tokuyama, OCI, etc), and the ratio of new capacity in semi-conductor grade and solar-grade product. If the progress for the above variables can meet or even surpass expectations, the condition of polysilicon supply and demand may be improved from the end of 1Q14 to the beginning of 2Q14.