The price of polysilicon in mainland China has continued to climb, triggering a parallel rise in the Asian spot market for polysilicon. This upward trend has significantly increased the production costs for wafer manufacturers. According to EnergyTrend, a division of TrendForce specializing in green energy research, the ongoing surge in raw material prices is squeezing the profit margins of silicon wafer producers. As a result, industry operators are facing mounting operational pressures, with many re-evaluating their pricing strategies in response to the current market conditions.
EnergyTrend's recent observations indicate that the mainland polysilicon spot market remains on an upward trajectory, with no signs of a reversal. This favorable environment has allowed operators to maintain higher prices, but the question remains whether this trend can be sustained. Although China has introduced a "double reverse" policy aimed at boosting domestic polysilicon usage, the quality, cost efficiency, and production capacity of local suppliers still lag behind those of major international players. As a result, the reliance on imported materials in the mainland market remains high, with importation ratios not showing significant decline.
Furthermore, the implementation of the double-reverse policy has led to stricter entry procedures for foreign polysilicon suppliers, extending processing times and increasing administrative hurdles. Combined with the uncertainty surrounding future market trends, suppliers have remained cautious, contributing to the continued high levels of spot market prices.
In terms of current costs, there is still some room for price adjustments in the silicon wafer sector. Following the recent agreement between the EU and China, a component price of €0.56/watt (approximately $0.74/watt based on current exchange rates) has emerged as a near-benchmark for the industry. At this level, after deducting manufacturing costs for modules and cells, the silicon wafer price could still be maintained around $0.3/watt. Given this, the industry believes there is still potential for further price increases, while wafer manufacturers feel that the previous price hikes have not been fully reflected in their pricing models, leading to a general sense of optimism about future price movements.
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