World set to install 593 GW of new solar in 2024 - Ember
Sep 19, 2024 13:28 CESTStrong polysilicon demand from China points to a fresh solar installation rush in the country ahead of the next feed-in tariff (FiT) cut on July 1, says German polysilicon market research firm Bernreuter Research.
"The upper part of the PV value chain obviously anticipates an installation rush that could be even stronger than what we saw in China in the first half of 2016," Johannes Bernreuter, author of the Polysilicon Market Outlook 2020, said.
Polysilicon imports into China, the world's biggest photovoltaics (PV) market, are increasing sharply, resembling the trend a year ago, with volumes being even higher. China's imports surged by 56.5% between October and November 2016, from 8,680 tonnes to 13,584 tonnes. They reached a new monthly high of 14,449 tonnes in December, Bernreuter Research said, citing Chinese customs statistics. For comparison, China's polysilicon imports rose from a low of 7,504 tonnes in October 2015 to 10,028 tonnes in November 2015, before peaking at 13,866 tonnes in March 2016.
Part of the latest surge could be attributed to maintenance shutdowns by Chinese manufacturers in September and October 2016 due to the weak spot price. Domestic production, however, recovered fast from 12,600 tonnes in October to a new high of 18,000 tonnes in December, the research firm said. In a further sign of strong polysilicon demand the international spot price average has been increasing from a record low of USD 12.65 (EUR 11.87) per kg in early October to over USD 16 per kg currently.
As South Korea has overtaken the US as the largest polysilicon importer in China, the strong imports have mainly benefited the three South Korean manufacturers OCI Co (SEO:010060), Hankook Silicon and Hanwha Chemical Corp (KRX:009830), Bernreuter Research said.
"OCI and Hankook have benefitted from low import duties of 2.4% and 2.8%, respectively, while US manufacturers have effectively been shut out from the Chinese market by prohibitive duty rates of 53.6% to 57%," explained Johannes Bernreuter.
Following resistance from Chinese producers, the Chinese Ministry of Commerce in November 2016 started a review of duty rates for Korean imports. Bernreuter said that Chinese producers are now fueling speculation on higher duties for Korea to push up the spot price. According to the research company founder, the international spot price will move towards USD 17 per kg in the first half of 2017 and then fall again.
(USD 1.0 = EUR 0.938)
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