The price of the photovoltaic industry chain has been "cut in half" across the board, but the profits have been made by middlemen?

Since the beginning of this year, the photovoltaic industry has grown strongly, and the installed capacity has reached a new high. However, at the same time, the industrial chain is also mired in the quagmire of "price reduction", overcapacity, intensified competition and other problems are highlighted.

The reporter learned that from the end of last year to the present, the profits made by the industrial chain have been largely earned by channel providers.

For this phenomenon of "middlemen making the difference", Qi Haishen, executive vice president of Jinchen Co., Ltd., told the "China Times" reporter that if the photovoltaic industry wants to develop healthily for a long time, it must be a state of low-cost operation, and there can be no huge profits in any link of the industrial chain.

In Qi Haishen's view, there is a trend of relative surplus in the photovoltaic industry at present, everyone is grabbing the market, and some channel providers have enjoyed a part of the profit dividend from the middle, which is not a normal phenomenon at this stage. He believes that this is a characteristic of the stage, and in the long run, the profit margin of the channel provider will not be too large.

The price of the industrial chain link is "cut in half" across the board

In the process of this unprecedented price reduction, the polysilicon sector was the most hurt, with the price fluctuating from 200,000 yuan/ton at the beginning of the year to about 60,000 yuan, a drop of about 70%.

According to the polysilicon transaction prices updated by the Silicon Industry Branch on December 13, the trading price of n-type polysilicon this week was 65,000-70,000 yuan/mt, with an average transaction price of 68,000 yuan/mt, down 0.15% month-on-month, and the average transaction price of monocrystalline dense material was 58,000-62,000 yuan/mt, with an average transaction price of 60,200 yuan/mt, down 0.33% month-on-month.

The reporter learned that polysilicon prices have fallen for eight consecutive weeks since October 18. The price of n-type polysilicon fell by less than 0.2% for two consecutive weeks, narrowing the decline and stabilizing the price, while the price of p-type polysilicon continued to decline.

Talking about the decline in polysilicon prices and the current situation in the market, Shi Zhenwei, a photovoltaic analyst at Shanghai Nonferrous Metals Network, pointed out to the China Times, "In fact, it is caused by overcapacity, and now high-quality polysilicon is cheaper and more resistant to decline." There is a shortage of high-quality materials and tight delivery. ”

Wafer prices followed polysilicon and fell all the way to a new low. Among them, M10 monocrystalline silicon wafers dropped from 6.7 yuan/piece to 2.08 yuan/piece at the end of last year, and G12 silicon wafers dropped from 6.7 yuan/piece to 3.26 yuan/piece, both of which fell by more than 50%.

Since mid-November, the wafer side has been in a state of continuous accumulation, which is due to factors such as downstream price cuts to boost demand, as well as the strategic choices of various companies. At present, P-type wafers are facing losses, N-type wafers have a slight gross profit, and the production capacity of each wafer has begun to shift from P-type to N-type.

The price of cells used to be as high as more than 1 yuan per watt, but now the transaction price of P-type M10 mono PERC cells has dropped to 0.38 yuan/W, and the transaction price of N-type M10 mono Topcon cells has remained unchanged at 0.48 yuan/W.

On the module side, prices have also been declining, with the price of modules below RMB 1/W repeatedly appearing in the market. According to InfoLink data, the price of 182mm PERC monofacial modules in China is 0.9-1.08 yuan/W, and the price of TOPCon modules is 0.93-1.15 yuan/W. Module prices fell below the "one-dollar line", and companies entered the breakeven line.

On the whole, since 2023, the price of the photovoltaic industry chain has entered a downward channel. Prices of polysilicon, wafers, cells, and modules have dropped by about 50%, all of which have been cut in half.

The middleman makes the difference

In the past few years, the photovoltaic industry has been singing all the way, attracting many enterprises to enter the game. Nowadays, in the context of the continuous price reduction of this industrial chain, the market is also accelerating the cleaning.

The reporter learned that some high-profile cross-border photovoltaic companies chose to leave the market and sell related projects. Some other companies have chosen to temporarily suspend production, and some well-known companies have transferred their shares in polysilicon companies, but Daqo Energy has recently expanded production against the trend.

Talking about the situation of enterprises out, Shi Zhenwei pointed out to reporters that some companies have stopped, but they have not withdrawn or gone bankrupt, they can only be said to have stopped first, and the battery link has even shown signs of P-type battery mass production.

When it comes to the proportion of polysilicon in the downstream cost, Han Xinkuo, an analyst at Baichuan Yingfu PV, told the China Times that when the price of polysilicon was relatively high in the past, the downstream cost accounted for more than 50%, but now the cost accounts for about 30%, which is basically halved. The current cost of first-line manufacturers is basically about 50,000 yuan, but the cost of some enterprises with ramp-up production capacity is more than 60,000 yuan, and every ton of silicon produced now is basically in a state of loss.

Interestingly, after learning from many sources, the reporter learned that from the end of last year to the present, the profits made by the industrial chain have been made by channel providers to a large extent.

A senior executive told the China Times that almost all of the module price reductions were taken away by channel providers, rather than given to owners.

However, Han Xinkuo believes that there is still a certain profit for the end user, but the decline in raw materials has not completely benefited the end user.

Qi Haishen told reporters that the price of domestic photovoltaic modules has dropped from more than two yuan to less than one yuan per watt, and channel providers have taken advantage of sufficient supply to earn some price differences, and there is a lot of room for premium. This is a characteristic of the phase.

In Qi Haishen's view, in the long run, the healthy development of the photovoltaic industry must be a state of low-cost operation, and there can be no huge profits in any link of the industrial chain. The profit margin of channel providers will not be too large, because the characteristics of the photovoltaic industry itself are continuous iterative upgrading to reduce the cost of electricity. The upgrading and iteration of the photovoltaic industry is relatively fast, and the changes brought about are relatively large, and the future still depends on scale benefits.

The quotation of the industrial chain is expected to accelerate to the bottom

How will the market perform in the future? Some leading enterprises said that second- and third-tier enterprises have to reduce production, stop production, or even withdraw from the industry, especially around the Spring Festival. With the slowdown, suspension, or even cancellation of construction of new production capacity planned by some enterprises, the market competition pattern in the second half of next year is likely to improve.

The reporter noticed that many brokerage institutions believe that the price of the industrial chain will continue to decline, but the decline will touch the cost line, and the room for price reduction is limited.

Among them, Capital Securities recently pointed out that the price of the photovoltaic industry chain is still continuing to find the bottom, and with the gradual ramp-up of polysilicon production capacity in the future, the price of the industrial chain is expected to fall slightly.

Shi Zhenwei told reporters that the price of the industrial chain will remain at a low level, and next year will be a stage when the industry begins to clear, rather than concentrate on clearing. He predicts that the lowest price of polysilicon will appear at the end of this year or in the first quarter of next year, and if it falls below 60,000 yuan/ton, it may break through the cost line of some manufacturers, and companies with poor quality and higher costs will be out first.

According to the analysis of the Pacific Securities Research Report, in 2023, the quotation of the photovoltaic industry chain will decline rapidly, the profits of the industrial chain will be squeezed rapidly, and under the simultaneous influence of policies and returns, it is expected that most of the capacity plans that have not yet been implemented will be postponed or canceled, and the growth rate of the supply side will gradually slow down. At the same time, as the quotation of the industrial chain approaches the cost line, the quotation game has entered the second half, and the quotation of the industrial chain is expected to accelerate to the bottom.

CITIC Futures believes that the expected annual photovoltaic installation capacity remains unchanged, but the expectation of excess supply and demand in the industrial chain is difficult to change. In the context of oversupply and demand, the prices of main materials fell across the board, and after the prices of the industrial chain continued to fall, some companies were close to losses, and some manufacturers began to take the initiative to adjust.

Editor-in-charge: Li Future Editor-in-chief: Zhang Yuning