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Price Situation Analysis of Polysilicon in the First Quarter of 2015
2015-12-26
    Abstract of China Reports Hall: Since entering 2015, polysilicon businesses in China have run smoothly. According to the statistics of Silicon Industry of China Nonferrous Metals Industry Association, the production of polysilicon in China was 23,700 tons from January to February this year: the production in January was 11,900 tons; and in February, 11,800 tons. Jiangsu Zhongneng's production accounted for 48% of total production from January to February in China, still taking the first place of the domestic production. TBEA and Luoyang SINOSICO ranked the second and third respectively. From January to February, the production of the top three enterprises accounted for 70.4% of the total production. Currently among 17 enterprises under operation, there are 7 enterprises whose operating rate reaches 100%. The rest is also in stable production. Jiangsu Zhongneng and TBEA are under overload operation, further reducing the cost and improving the efficiency.
    Crystalline silicon is a raw material for producing single crystal silicon rod. The crystal pulling process is usually used, that is, in the single crystal furnace of super vacuum, using seed crystal to pull out the single crystal silicon rod from the molten polysilicon, and meanwhile making p-type or n-type single crystal silicon rods by adding boron or arsenic.  
   Currently the international polysilicon market is mainly monopolized by several large factories of the United States, Japan and Germany, who have formed the technological monopoly. In March, 2013, the amount of imported polysilicon from South Korea, the United States and Germany accounted for 87.5% of the total amount.  
  On July 18, 2013, China's Ministry of Commerce announced the preliminary anti-dumping results on importing polysilicon from the United States and South Korea. From the 24th of this month, China will impose import deposit of up to 57% on solar-grade polysilicon products originating in the United States and South Korea. To some extent, this action will inhibit foreign manufacturers from dumping the polysilicon in China. Product prices will rise modestly and the increase will be limited. The following is the price situation analysis of polysilicon in the first quarter of 2015.  
    Since entering 2015, polysilicon businesses in China have run smoothly. According to the statistics of Silicon Industry of China Nonferrous Metals Industry Association, the production of polysilicon in China was 23,700 tons from January to February this year: the production in January was 11,900 tons; and in February, 11,800 tons. Jiangsu Zhongneng's production accounted for 48% of total production from January to February in China, still taking the first place of the domestic production. TBEA and Luoyang SINOSICO ranked the second and third respectively. From January to February, the production of the top three enterprises accounted for 70.4% of the total production. Currently among 17 enterprises under operation, there are 7 enterprises whose operating rate reaches 100%. The rest is also in stable production. Jiangsu Zhongneng and TBEA are under overload operation, further reducing the cost and improving the efficiency.  
    In fact, in 2014, the scale of China's photovoltaic industry continued to grow. The polysilicon production reached 132,000 tons with year-on-year growth of 57%. The production of silicon wafer reached 38 gigawatts with year-on-year growth of 28%. Among the global top 10, there were enterprises from each link of the photovoltaic industry chain and an enterprise of China took the first place.  
    In terms of polysilicon, there have been more than 18 production enterprises in China. The scale of production rose by 57.1% year on year. The industry capacity utilization was enhanced significantly and reached 84.6%. The industry concentration was high. The production of the top ten accounted for up to 91%and the production of the top five accounted for up to 77%. The product competitiveness continued to grow. There has already been the basis of realizing the import substitution. 
    The current price of polysilicon decreased by 18.45% year on year in 2014.
    The overall market of polysilicon was relatively stable and had a slight concussion at the same time. From January to February of this year, the price of polysilicon in China slipped slowly and slightly by 2.4% from 144,400 yuan per ton in early January to 140,900 yuan per ton in the middle of February. After entering the Spring Festival, affected by factors like workers' paid leave in the holiday and logistics, little deal of polysilicon materials was concluded. The price of 140,900 yuan per ton had been maintained to the end of February. According to the latest figures, early last week, domestic enterprises' external quote of polysilicon was around 133,666 yuan per ton on average. At the end of last week, their external quote of polysilicon was 133,333 yuan per ton on average, decreasing by 0.25%. The current price decreased by 18.45% compared to the same period of last year.  
    For the cause of the polysilicon price declining slowly, Ma Haitian, Deputy Secretary General of Silicon Industry of China Nonferrous Metals Industry Association, and Liu Jing, an analyst, thought that first of all, it was caused by weak demand. In January and February, reducing the inventories was still the priority. The first quarter wasn't the busy season of photovoltaic installation originally. Secondly, the polysilicon market was well supplied; most domestic polysilicon enterprises were in stable operation; and some companies had production expansion plans, so the supply exceeded the demand. Thirdly, the price of polysilicon imported from Wacker in Germany and OCI in South Korea was about 3,000 yuan per ton lower than products of the same level in China, which obviously had impact on polysilicon enterprises in China. Domestic enterprises had to compete with imported polysilicon for fixed market share by reducing price.  
    From 2008 to 2009, twists and turns were experienced. At that time, the price of polysilicon slipped to USD 40 per kilogram suddenly.  
    From 2009 to 2011, it rose to USD 90 per kilogram. From 2011 to 2013, it dropped to USD 15 per kilogram. Then since the second half of 2013, it began to rebound gradually. It should be said that the price of polysilicon is still in the process of rebounding now." Wang Bohua, Secretary General of China Photovoltaic Industry Association, said.  
    As the weather gets warmer, more and more photovoltaic projects come into operation and the financial support in the photovoltaic industry is subsidized, the market demand for polysilicon will be recovered. According to the analysis of the industry insider, from the perspective of supply and demand, it's expected that the price of polysilicon still has the driving force to rebound before the end of the second quarter.  
    Research and development technology of polysilicon remains to be improved.
  When the market tends to be weak, some enterprises strengthening the production equipment and technology innovation can hold the advantage.  
"The effective capacity of polysilicon is in ascension. Now, the profitability of some backbone polysilicon enterprises is relatively good, while some having high production costs are still in the red. The capacity utilization is maintained at a high level. Some enterprises are preparing plans to expand production. For example, Tianhong, GCL and Asia Silicon have some development plans." Wang Bohua said.  
However, for some Chinese polysilicon enterprises on the verge of profit or in the red, their production equipment and technology remain to be improved. Zhao Jian, Chief Engineer of Jiangsu Shuangliang New Energy Equipment Co., Ltd., thought that, after nearly a decade of development in China, in terms of improving Siemens technology and core equipment, there had been a lot of improvement and a great progress, but because of domestic production management at a relatively low level and extensive production management, the purity of polysilicon were relatively not too high, and even little can reach the electronic level of the national standard.  
At the end of March, GCL-Poly, a leading polysilicon enterprise, announced its financial reports of 2014. The announcement shows that its turnover in 2014 reached 37.225 billion Hong Kong dollars in record time. Its market share of polysilicon and silicon wafer continued to be the first in the world. The production of polysilicon increased to 66,900 tons from original 50,000 tons. This year, with technology, research and development advantages, GCL-Poly promoted the business of polysilicon and silicon wafer to maintain double-digit growth. "GCL-Poly is in the upstream of the photovoltaic industry chain. Regardless of size, cost, or energy consumption, power consumption, it's the world's leading enterprise." Dai Bing, Chief Technology Officer of GCL-Poly Energy Holdings Limited, said.  
In April, TBEA announced its annual financial report of 2014. Its production of polysilicon reached 17,500 tons with 1,515 tons of inventory, filled orders and no existence of overstock.  
A financial report announced by DAQO New Energy Co., Ltd., a polysilicon manufacturer, shows that, its annual revenue of 2014 grew to USD 0.1826 billion by 67.5%, far better than the net loss of performance of USD 70.9 million in 2013.  
Improved Siemens method is a mature technology in the world. There is no breakthrough currently, so polysilicon production enterprises in China still needs to further refine management, improve product quality, and meanwhile research and develop new production equipment and technology, such as silane fluidized bed method, gas liquid deposition method, etc..
Source of this article: CPNN: China Power News Network  URL for this article: http://www.chinabgao.com/freereport/66038.html 
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