Continuing Slide in Solar Materials
Prices for polysilicon and silicon wafers in China continued their downward trajectory this week, with n-type re-feed and dense polysilicon falling 6.39 percent and 6.42 percent respectively to an average of 45,200 yuan per ton, approximately $6,240. The data, reported by the China Nonferrous Metals Industry Association, reflects persistent weakness in downstream demand that has been pressuring the solar manufacturing supply chain for months.
N-type granular polysilicon averaged 44,000 yuan per ton, while wafer prices also declined across all major formats. The n-type G10L wafer fell to 1.03 yuan per piece, the G12R format to 1.12 yuan, and the larger G12 wafer to 1.33 yuan. Industry analysts attribute the price erosion to a combination of excess manufacturing capacity, seasonal demand patterns, and falling polysilicon costs that have removed a key price floor for wafer manufacturers.
Overcapacity Meets Seasonal Weakness
The Chinese solar manufacturing sector has been grappling with overcapacity since aggressive expansion during 2023 and 2024 brought a massive increase in production capacity across the entire supply chain. From polysilicon refineries to cell and module factories, Chinese manufacturers invested heavily in anticipation of continued rapid growth in global solar deployments.
While global solar installations continue to grow at a healthy pace, the rate of capacity expansion has outstripped demand growth, creating a supply glut that has driven prices down across the value chain. Many smaller manufacturers are operating at reduced utilization rates, and industry consolidation has become an increasingly common topic among analysts and executives.
The seasonal factor compounds the structural overcapacity issue. The first quarter is traditionally a slower period for solar installations in many key markets, as winter weather limits construction activity in the Northern Hemisphere and project developers wait for updated subsidy frameworks and grid connection allocations for the new year.
