According to statistics, the price of polysilicon on the spot market of silicon raw materials in China has been between 700,000 yuan/ton and 740 yuan/ton recently. Compared with the price of 650,000 yuan/ton to 720,000 yuan/ton at the end of November, the price of polysilicon rose slightly.

Xiao Jian, a researcher at China Investment Advisor New Energy Industry Group, believes that there are two main reasons for the slight increase in polysilicon prices. On the one hand, the tense situation on the Korean Peninsula has caused some PV companies to snap up polysilicon. At present, South Korea’s OCI’s polysilicon production ranks in the top five in the world, and its customers mainly come from China’s Taiwan and mainland China. After the situation on the Korean peninsula deteriorated, South Korea sealed off its sea ports. OCI was unable to export polysilicon on time, so some of its customers turned to the Chinese polysilicon market for alternatives. On the other hand, the production costs of domestic polysilicon manufacturers have risen. In the polysilicon production process, a large amount of electricity is required to be consumed. Recently, the price increase of the national power sector has undoubtedly pushed up the production cost of polysilicon.

Xiao Han pointed out that the rising trend of domestic polysilicon prices is not sustainable, and there will be a correction in the coming months. First, the demand for polysilicon by photovoltaic companies will weaken. Due to the uncertainties in the global PV market growth next year, some domestic PV companies have adopted a more cautious capacity expansion strategy to control their own production. In addition, in some of the major PV markets, there are cases of unsalable PV modules. The weakening of these photovoltaic market demands will directly reduce the demand of polysilicon for photovoltaic companies.

Second, the decline in the prices of downstream products will be transmitted to the upstream raw materials link, driving the price of raw materials to decline. At present, the price of solar photovoltaic modules has shown a downward trend. Taking a 190W single crystal module as an example, the price was between 1.86/W to 1.94 US$/W in early November, and the price of this type of single crystal module had dropped to 1.76 US$/W to 1.87 US$/W in early December. It will take some time for the price of solar PV modules to be transferred to the raw materials link. It is expected that the price of polysilicon will come back after a few months.

The report released by the China Investment Advisor pointed out that for many years, as the core technology for producing polysilicon has been grasped by a few international polysilicon giants, they have used technological advantages to share the high profits of the industry. However, the emerging emerging polysilicon manufacturers are currently attacking the global polysilicon market, and high polysilicon prices will be difficult to sustain. With the drop in polysilicon prices, the high profit margin of the polysilicon industry will surely return to a relatively normal level.