Oct solar polysilicon pricing sees steepest fall since Feb

Nov 19, 2012 - Demand and pricing in the global solar polysilicon market fell in October at the fastest rate since February and a further erosion in prices is forecast for November, according to the IHS Solar Polysilicon Price Index.

A potential modest uptick in spot market pricing at the start of 2013 could be short-lived as it would come on the back of expectations of improvement in market conditions and not a balancing of supply and demand, IHS (NYSE:IHS) also projected.

In October, spot market pricing for 9N solar polysilicon tumbled by over 9%, with contract pricing slipping by around 1%. Polysilicon in the 6N to 8N grade saw drops of 7% and 8% for the spot and contract segments, respectively.
Senior analyst Glenn Gu said that in October, total shipment volumes sank by 14% on the month. Supply levels and inventories were also down as second- and third-tier Chinese suppliers cut production but this was not enough to restore the supply-demand balance, Gu added.

In December and January, spot market pricing is expected to increase by 2.4% for 6N to 8N grade polysilicon and to be flat for 9N and higher-grade polysilicon.

Production cut-backs, declining inventories and expectations for a demand rebound in 2013 will lead to a slight uptick in spot prices at the start of 2013, Gu said, but added that those will still be well below prices on the contract market, prompting solar polysilicon suppliers to keep reducing contract prices. "Overall, this indicates that supply will remain in excess of demand, and that pricing will return to a state of decline later in 2013," Gu said.

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