Our reporters Zhang Yingying and Wu Kezhong report from Beijing.
Supply and demand turbulence, technology iteration, and competition disruption" – this is JinkoSolar and Jinko Power's Chairman Li Xiande's accurate summary of the PV market in 2023.
But if there is one word to describe the intuitive performance of the market, it is undoubtedly "**downside". Since 2023, PV has been volatile, superimposed battery technology has accelerated iteratively, and the industry has an unprecedented degree of involution.
Taking the second centralized procurement of photovoltaic modules from 2023 to 2024 on December 6 as an example, the module companies participating in the bidding are generally lower than 095 yuan watts, and even some companies exposed 0The low price of about 86 yuan watts. Compared to the beginning of this year 18—1.At the level of 9 yuan watts, such a component has been cut in half.
* The downturn puts companies at risk of declining profitability in the short term. Recently, Qu Xiaohua, chairman of Canadian Solar, said bluntly at the 2023 Bloomberg New Energy Finance Forum: "The photovoltaic industry is now in the 'strongest involution in history', and everyone should not expect a particularly high single-watt profitability of photovoltaic next year." ”
Many industry insiders believe that the real competition will start in 2024. Shi Zhenwei, chief analyst of SMM PV, told the "China Business Daily" reporter that in the first half of next year, the photovoltaic market will be the most fierce time. For some companies, it will be a question of survival, not profitability.
Profitability is being challenged
It is undeniable that the downward trend has become the main theme of the photovoltaic market in 2023.
With the gradual release of new production capacity, polysilicon** has declined rapidly, causing the rest of the industrial chain (wafers, cells and modules) to decline.
According to the data released by the Silicon Branch of the China Nonferrous Metals Industry Association on December 6, polysilicon is still continuing, of which the transaction price of monocrystalline dense material has fallen below 60,000 tons, with an average transaction price of 6040,000 tons. According to rough statistics, since the beginning of this year, polysilicon** has fallen by more than 60%.
Under the dual pressure of conduction and intensified competition, the module soon dropped to less than 1 yuan. According to the data of Infolink Consulting on December 6, there are 182 PERC monofacial modules in China**09—1.08 yuan watts, topcon components**093—1.18 Yuan Watt, HJT Module**125—1.35 yuan watts.
The reporter noticed that in the recent module bidding process, photovoltaic companies frequently quoted 095 yuan watts or so, even less than 0$9 Watts**.
On December 6, in addition to the second bid opening of CNNC Huineng for 2023-2024 photovoltaic module centralized procurement, Baolixin New Energy also opened the bid for 40 MW modules. According to industry reports, the lowest number of participating head module companies fell to 083 yuan watts, the overall average price remained at 0About 9 yuan watts.
A market source from a second-tier module company commented: "It will continue to fall, falling below 0 next year."8 yuan watts is not impossible. ”
Gaobian shares said that at present, all aspects of the photovoltaic industry are understarted and sluggish, and all links are facing the risk of declining profitability in the short term, and the industry may usher in a round of competition for capacity clearance.
JinkoSolar believes that the decline in photovoltaic modules is expected to accelerate the clearance of backward production capacity in the industry, and ultimately promote the balance between supply and demand. In the future, enterprises with integration, technology leadership or scale cost advantages will have better profit opportunities.
The decline of all links in the photovoltaic industry chain has brought huge challenges to the profitability of enterprises.
The reporter noticed that photovoltaic polysilicon, silicon wafers, cells and module companies represented by Tongwei Co., Ltd., Daqo Energy, TCL Zhonghuan, Hongyuan Green Energy, Aixu Co., Ltd., and LONGi Green Energy all experienced a decline in operating income and net profit in the third quarter.
Among them, Daqo Energy, TCL Zhonghuan and Aiko Co., Ltd. achieved operating income of 35 in the third quarter5.3 billion yuan, 1375.6 billion and 636.8 billion yuan, down 57 percent year-on-year38%、 24.19% and 3530%；The net profit attributable to shareholders of the listed company was 68.9 billion yuan, 165.2 billion yuan, 57.9 billion yuan, down year-on-year72% and 2714%。
However, compared with the third quarter, the profitability of PV companies in the fourth quarter of this year and next year may be further pressured.
In the fourth quarter, the destocking of the industry will continue, and the downward speed of the industrial chain will slow down. As the first quarter is the off-season for traditional industries, there may be a signal of bottoming out earnings in the first quarter of 2024. Nomura Oriental International ** analysis said.
CITIC Construction expects that "the bottom position of the photovoltaic industry chain will appear from December this year to the Spring Festival next year, and with the new low-price orders signed in the second half of 2023 to begin to be delivered in large quantities, the bottom position of single-watt profitability is expected to be established from the first quarter to the second quarter of 2024, and then the industrial chain and profitability will enter the L-shaped bottom." ”
Shi Zhenwei told reporters that compared with the third quarter, the fourth quarter of photovoltaic ** really entered the collapse stage. In the first half of next year, the photovoltaic market will be the most fierce time. For some companies, next year will be a question of survival, not of profits.
In the next 2-3 years, the adjustment of supply and demand structure will be accelerated
Over the past 20 years, the photovoltaic industry has experienced three industry crises in the process of rapid development, which were triggered by the financial crisis, the "double anti-dumping" and "5.31" policies. These changes in the different external environment have led to different degrees of inhibition on the demand side of photovoltaics, and the product has also encountered the risk of falling prices, and the industry has experienced a reshuffle of big waves.
Nowadays, the photovoltaic market is facing a new round of changes, due to the changes in the supply and demand relationship of the photovoltaic market itself, the risk of overcapacity has intensified, and the iteration of new and old production capacity has been superimposed, and the competition has intensified.
Recently, news about production cuts, factory closures, and layoffs has spread far and wide.
Among them, PV Magazine reported two pieces of news that attracted attention from the outside world: one is that PV manufacturer REC closed its polysilicon production plant in Norway due to high electricity prices;On the other hand, Hanwha QCELLS, a subsidiary of Hanwha Group, said that it would close its 35 GW solar panel manufacturing plant, the company will offer a voluntary severance program to employees.
At the same time, the phenomenon of domestic factory production reduction and insufficient operating rate has also continued for some time. According to Infolink Consulting's analysis, looking ahead to December, most module manufacturers will reduce production, except for a small number of module makers who maintain high utilization rates due to order support. Regarding layoffs, the reporter learned that this is not a common phenomenon at present, and part of the reason involves the iteration of new and old production capacity of the factory, and personnel adjustment has naturally become a problem.
Wang Jian, Director of TrendForce's New Energy Business Unit, said, "In the next 2-3 years, the PV industry chain will be in the process of clearing production capacity, and the growth rate of new capacity expansion will continue to decline. ”
The reporter noted that the current supply and demand pattern of the photovoltaic industry chain is being adjusted. On the one hand, affected by the environmental changes in the photovoltaic industry chain, the product quality has decreased, and some enterprises have taken the initiative to terminate the expansion or delay investmentOn the other hand, affected by the refinancing policy of the capital market, corporate financing is constrained, and then passively tightens the expansion action.
JA Solar said in the roadshow in November that in the short term (half a year to a year), leading companies will increase their market share through cost advantages, and some leading companies will be affected by the tightening of refinancing in the capital market, with high debt ratios and operating cash flow cannot cover capital expenditures, which may slow down the pace of new production capacitySecond- and third-tier enterprises have to reduce production, stop production, or even withdraw from the industry, especially around the Spring Festival next year. Therefore, the planned new capacity may slow down, suspend or even cancel construction, so that the market competition pattern in the second half of next year is likely to improve.
Shi Zhenwei told reporters that in a short period of time, the goal of effectively improving the supply and demand relationship of the entire photovoltaic industry chain will not be achieved soon. However, some enterprises will indeed be eliminated next year, especially with the acceleration of the iteration of new and old production capacity, the inventory and sales pressure of P-type products are relatively large. At this stage, vertically integrated enterprises are more competitive by virtue of their advantages in technology and cost.
Shi Zhenwei also believes: "On the demand side of terminal power stations, it is also worth paying attention to solving the problems of power grid consumption and land space. ”