Greentech Lead America: Total polysilicon capacity will
exceed 385,000 tons in 2012, of which 70 percent is held by a small number of
tier 1 producers, according to NPD Solarbuzz Q3’12 Polysilicon and Wafer
Supply Chain Quarterly Report.
In fact, these tier 1 providers alone are forecast to
satisfy all polysilicon demand under the NPD Solarbuzz most-likely end-market
scenario for the next few years.
Global polysilicon capacity is expected to grow 22
percent in 2012 and a further 18 percent in 2013. Average industry-wide
polysilicon prices for photovoltaic (PV) applications are forecast to drop 52
percent in 2012, while plant utilization is expected to decline from 77 percent
in 2011 to 63 percent.
“The last thing the polysilicon industry needs right now
is more capacity. But some of the new plants that were started two to three
years ago are proving hard to abandon,” stated Charles Annis, vice
president at NPD Solarbuzz.
“In addition, some producers are adding capacity in an
attempt to lower their costs through economies of scale. Some are improving
capacity productivity, while others are upgrading manufacturing technology,
such as adopting hydrochlorination, to reduce power consumption and increase
scale,” Annis added.
Unless end-market demand provides a strong upside
surprise to expected polysilicon requirements, many of the 57 tier 2 and 3
producers are likely to exit the industry within the next 18 months, the report
says. Indeed, even a few of the less-experienced tier 1 makers may not survive
over the next couple of years.
Average polysilicon prices are forecast to start to
stabilize in 2013 at around $21/Kg, as the remaining players rationalize
utilization rates in line with end-market requirements while ensuring that
selling prices remain above their cash costs.
“If China’s Ministry of Commerce decides to impose
anti-dumping and countervailing duties on polysilicon imports, prices are
likely to increase,” added Annis. “However, this will only help a limited
number of local Chinese polysilicon producers. It will hurt not only foreign
producers but many Chinese wafer, cell, and module makers. Also, it will not
help to resolve the polysilicon oversupply issue and could restrict end-market
growth due to higher prices.”
In addition to import duties, any increase in polysilicon
prices will likely be limited by first tier supply sufficiency and end market
demand for the next couple of years. However, tier 1 polysilicon producers
continue to plan for longer term PV involvement, where low cost structures,
economies of scale, and continuously improving productivity are expected to
yield benefits as shipment volumes grow.