Solar Wafer Prices Plunge, Trade War Looms
June 4, 2024 :The solar energy industry faces uncertainty as prices for a key component, solar wafers, continue to decline. This price softening coincides with a complex international trade situation, raising concerns for manufacturers and consumers.
Data from industry research firm OPIS indicates that average transaction prices of mono PERC and n-type M10 wafers in the Chinese domestic market have fallen to around CNY 1.13 (USD 0.16) per piece. This represents a further decrease from the previous week’s figures, signaling a sustained downward trend.
While lower wafer prices could potentially translate to more affordable solar panels for consumers, the current situation is challenging. The decline in pricing is partly attributed to an oversupply of wafers in the global market. Southeast Asian manufacturers, particularly Vietnam, Malaysia, Thailand, and Cambodia, have ramped up production capacity in recent years. However, this expansion has outpaced demand, leading to a glut of wafers and subsequent downward pressure on prices.
Further complicating the situation is the ongoing trade dispute between the United States and China, the world’s two largest solar panel markets. The U.S. Department of Commerce has investigated alleged anti-dumping and countervailing duty (AD/CVD) violations by manufacturers in those above Southeast Asian countries. If these allegations are upheld, tariffs as high as 250% could be imposed on imported solar panels, significantly impacting their affordability in the U.S. market.
The potential trade barriers raise concerns for solar panel manufacturers and project developers. Manufacturers in Southeast Asia, heavily reliant on the U.S. market, could face significant financial strain if tariffs are imposed. U.S. project developers might face delays and higher costs due to potential supply chain disruptions or price increases for imported panels.
The current situation underscores the delicate balance between fostering a competitive solar panel market and ensuring fair trade practices. While lower wafer prices could benefit consumers in the long run, a prolonged period of oversupply and potential trade restrictions could hinder the growth of the solar energy industry.
Industry stakeholders closely monitor the ongoing trade investigations and potential actions by the U.S. Department of Commerce. Additionally, efforts to address the oversupply issue and stabilize wafer pricing will be crucial for ensuring solar energy solutions’ continued viability and affordability. The coming months will be critical in determining the trajectory of the solar energy market and its accessibility to consumers.
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