The price of solar modules has surged close to 0.9 yuan per watt, raising questions about the sudden turn of events in the struggling photovoltaic industry. Just a few months ago, the industry was grappling with prices below production costs, but after price hikes announced by leading companies in February, module prices quickly climbed past 0.7 yuan per watt.
According to the latest data from InfoLink, as of March, the spot price of mainstream distributed photovoltaic modules has risen to 0.8 yuan/W, reflecting a more than 33% rebound from the low of 0.6 yuan/W at the end of 2024. Longi Green Energy’s Hi-MOX10 anti-dust modules have reached prices between 0.85-0.9 yuan/W, marking a near two-year high. On March 20, InfoLink reported that the prices for distributed modules have increased significantly, with execution delivery volumes rising as well. The TOPCon prices are now between 0.68-0.8 yuan, averaging around 0.73 yuan, while HJT modules are priced between 0.76-0.85 yuan, with concentrated project prices ranging from 0.76-0.78 yuan. For N-TBC, current prices are around 0.73-0.82 yuan, with project prices between 0.73-0.76 yuan.
Additionally, prices for upstream N-type cells, silicon wafers, inverters, encapsulants, EVA, and photovoltaic glass have also seen various degrees of increase. For instance, the price of 182*210mm TOPCon cells has risen for five consecutive weeks, increasing by 0.05 yuan/W. The G12RN silicon wafers have also seen two price hikes totaling 0.1 yuan/W since March. Furthermore, the price of photovoltaic-grade EVA has surged by 248.57 yuan per ton in just two weeks.
According to InfoLink, silicon material prices are also poised to rise, with expectations that March prices will settle between 39,000 and 42,000 yuan/ton due to inventory considerations. The photovoltaic industry, previously mired in overcapacity, cutthroat competition, and low-price sales, is witnessing a rapid turnaround that has surprised many. This raises the question: is the photovoltaic sector finally recovering? Will prices plummet below production costs once the rush to install wanes?
As analysts debate when the photovoltaic industry will emerge from its winter slump, modules have sold out. Longi Green Energy’s President of Distributed Business for China, Niu Yanyan, recently indicated a tight supply for all types of their module products. Leading companies such as Trina Solar, Tongwei, and Canadian Solar have significantly depleted their stock of popular module models, with production lines entering a “just-in-time” mode. Delivery timelines vary from one week to two weeks, and some companies have reported orders extending into the second quarter. In response to market demand, previously downsized photovoltaic manufacturing bases are now rapidly hiring again. Major companies are in high demand, and even secondary and tertiary manufacturers are busy fulfilling orders.
A medium-sized module factory in Jiangsu is currently shipping out 300 trucks daily but still cannot meet demand. A third-tier manufacturer in Hebei has all production lines operating 24/7, with orders extending beyond April. A screenshot circulating among traders shows that all brands of modules have paused futures orders, accepting only spot orders, with reminders to customers not to ask for prices but instead to inquire about availability. Some traders have rushed to factories only to find long lines waiting for orders, with wait times extending over two days for those at the end of the queue.
Traders’ stockpiling has further fueled this market surge, with some claiming they have secured up to 1 GW worth of modules. In their scramble for available stock, various parties have employed different strategies, including leveraging relationships to jump the line. Some have even shown willingness to accept products they would not typically consider. Products from larger manufacturers that did not meet specifications are being sold off quickly, with expectations that this batch will hit the market within 15 days.
Orders for popular models priced below 0.68 yuan/W have been significantly canceled by manufacturers, and customers wishing to pick up their orders are being asked to pay more, with some even facing requests for additional payments. For clients urgently needing modules, there appear to be no alternatives—switching suppliers still yields no options below 0.7 yuan/W. Some traders have even begun applying for refunds due to delays in receiving their goods, resulting in significant losses for some projects. Others have faced legal action from clients over unmet supply agreements, which is not entirely surprising given that many traders have received legal notices. They have had to pay manufacturers upfront, and when the products are not delivered, their only recourse is to also pursue claims against the manufacturers.
Besides supply agreements being breached, the market has also seen issues with private labeling. Recently, Trina Solar and Aiko Solar issued statements warning of significant risks related to the quality, after-sales service, and user rights of products purchased from unauthorized channels. An industry insider noted that due to previous production limits, larger manufacturers currently cannot keep pace with demand and have to rely on subcontractors. For subcontractors, the market price of over 0.7 yuan is more appealing than the 0.65 yuan production cost, leading them to produce for larger manufacturers while quietly selling branded products themselves.
The unexpected market surge is attributed to two main factors: a shift in supply and demand dynamics and a revival in overseas markets. The changes in supply and demand are primarily due to a deep reduction in production and low inventory levels, coupled with a sudden market explosion.
The revival in the domestic market can be traced back to government policies implemented in January, including the National Energy Administration’s new management measures for distributed photovoltaic development, and the National Development and Reform Commission’s notice aimed at promoting the high-quality development of new energy. The former establishes a cutoff date of May 1, 2025, for old policies, allowing existing projects to benefit from full-grid access, while newer projects must opt for self-consumption or self-consumption with excess electricity fed back to the grid. The latter will also see a split in policy implementation by June 1, 2025, favoring old projects under current price assurance policies while requiring new projects to enter market transactions with local pricing mechanisms for renewable energy.
The implications of these policies are significant. In simple terms, projects benefiting from the old policies have more guaranteed returns, while the new policies introduce uncertainties. For example, if a rooftop project in Chengdu delays its grid connection until May, the Internal Rate of Return (IRR) could drop by 25%, extending the payback period by four years.
This uncertainty has triggered a rush to install modules before the cut-off dates of April 30 and May 31. In addition, the overseas market is showing signs of recovery, particularly in Europe, where inventory clearing has been completed, and many new projects are poised to launch in Eastern European countries, leading to optimism about the European market in 2025. The photovoltaic procurement confidence index has surged, with experts predicting that Europe’s installed capacity could double by 2025. This optimism has provided module manufacturers the confidence to raise prices. In January, the average price of photovoltaic modules in the European market rose by 5%-10% compared to the same period in 2024.
Correspondingly, after a painful year of losses in 2024, the entire Chinese photovoltaic industry has reached a consensus on maintaining low operating rates through production limits, with silicon and cell inventories having dropped to low levels. According to statistics from TrendForce, as of early January, N-type silicon wafer inventories had adjusted to 1.6-1.8 billion, and SMM reported that as of February 5, cell inventories stood at 7.85 GW. Meanwhile, module inventories in early January were less than 50 GW. Following the market surge, inventories were quickly cleared. The resulting supply shortage has driven up prices, creating an environment that has further spurred traders to stockpile.
InfoLink reported that from January to March, domestic module production was well controlled under self-discipline. With much of the overseas inventory sold off, only older models remain. Additionally, the volume of goods shipped to overseas warehouses from January to February was low, resulting in shortages of new popular models. An industry observer noted that not only is the distributed market experiencing a rush, but state-owned and national enterprises are also pushing to complete centralized projects before April 30, which adds pressure to the supply of the distributed market.
The price increases resulting from this rush to install modules will undoubtedly benefit photovoltaic companies’ profits in the first and second quarters. For firms that faced significant losses last year, this is a rare opportunity for recovery. Public information suggests that due to recent price increases in upstream materials in the photovoltaic industry chain, the minimum production cost for photovoltaic modules has exceeded 0.72 yuan. If sold at the competitive price of 0.8 yuan, modules could yield a profit margin of 0.08 yuan per watt. Estimating based on the shipment rankings from the first half of 2024 (including JinkoSolar, JA Solar, Trina Solar, and Longi Green Energy), which totaled 147 GW, maintaining last year’s shipment volumes could generate profits of approximately 1.176 billion yuan. While this profit may seem limited compared to last year’s losses, the positive signals it sends are invaluable—leading photovoltaic leaders are likely to collectively turn losses into profits in the first half of the year.
However, the price increases are not entirely beneficial for the photovoltaic industry. If the price stabilizes at 0.8 yuan/W, it will not only relieve financial pressures on leading companies but also revive production capacities that are on the verge of being eliminated. This could jeopardize the industry’s efforts to cut excess capacity. The industry now faces the question of whether the 0.8 yuan/W price can be sustained. Some industry insiders suggest that manufacturers are deliberately holding back to drive prices up.
InfoLink statistics indicate that to meet supply needs, the industry’s operating rate increased by 24% in March, with an expected output of 52 GW, which should quickly alleviate the current supply-demand tension. Another industry observer expressed skepticism about further price increases, predicting that prices will likely decline instead. Some brands lacking strong distribution channels have not raised prices, indicating that raw material costs are sufficient to maintain current pricing. The first ten brands will soon have ample supplies, and to quickly deplete inventory, attractive pricing will be necessary. Additionally, subcontractors have released low-priced orders, which will also impact brand pricing.
From the downstream market perspective, some household brands have begun to wind down operations, ceasing to accept new orders and shipments. “The highest price EPC can accept is around 0.8 yuan; anything higher will not be feasible,” said a distributor, who has now stopped stockpiling and started reducing inventory for delivery. Some industry insiders believe that distributors have overstocked based on inflated demand, which could lead to price decreases as they clear out inventory.
InfoLink predicts that the effects of the rush to install will likely keep supply chain price increases sustained until mid to late April. Some also suggest that normal module supply may not resume until June or July. This is due to the need for projects to initially install a portion of modules to meet grid connection deadlines ahead of April 30, with subsequent installations to follow. Regarding prices, optimists predict they may stabilize around 0.7 yuan/W in the second half, while pessimists warn they could drop back to the 0.6 yuan/W range.
It is noteworthy that alongside this trend, while production bases are rapidly hiring, they are primarily seeking general laborers, with trial periods set to conclude by May 31. This indicates that larger manufacturers are not optimistic about the sustainability of the current price hikes. Many industry insiders have communicated to Huaxia Energy Network that large-scale capacity clearing has not yet been completed, and the industry has not reached a recovery point. “After the rush to install, if there is no significant market growth, prices will certainly fall back, and everyone will only profit for a few months. Sales in the second half will still depend largely on the overseas market,” stated one industry expert.
