Global polysilicon industry heading back toward oversupply, Bernreuter Research

After a short recovery in 2013, the global polysilicon industry is once again heading toward oversupply, according to the latest report from Bernreuter Research. »The 2014 Who’s Who of Solar Silicon Production« predicts that global oversupply caused by new entrants and recommissioned production plants will lead to a significant drop in the price of polysilicon this year.
»Although shutting down capacities of approximately 135,000 MT since 2011 has
solved the oversupply problem in the short term, new entrants and recommissioned Chinese plants will again tip the supply-demand balance in 2015 at the latest,« says Johannes Bernreuter, head of Bernreuter Research and author of the new report. Correspondingly, the polysilicon price on the spot market will fall from $18 per kg at the end of 2013 to $16 per kg by the end of 2014, forecasts Bernreuter.
According to Bernreuter’s preliminary estimates, global polysilicon output fell to 228,000 MT in 2013, a decrease of 4% over 2012. The decline was mainly due to low utilization rates in the first quarter. At the same time, the amount of newly installed PV capacity increased at a double-digit rate to about 36 GW in 2013 – this ensured that the large polysilicon inventories resulting from oversupply in 2011 and 2012 were greatly diminished.
The report forecasts that new low-cost capacities of up to 66,000 MT will come online in 2014. This new capacity will push expensive producers out of the market and will reduce the spot price. Bernreuter does not expect polysilicon prices to improve much over the next 3 years.

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