On the evening of December 25, Tongwei Co., Ltd. announced that the company intends to sign an agreement with the people of Ordos City, Inner Mongolia Autonomous Region, and the people of Zhunger Banner to invest about 28 billion yuan in the Zhunger Economic Development Zone of Zhunger Banner, Ordos City, to build a green substrate integration project. According to industry insiders, the current imbalance between supply and demand of polysilicon is bottoming out, and leading PV companies are expanding production against the trend, or they are intending to further lock in scale advantages with the help of favorable nodes in the cycle.
Since 2023, a large number of new production capacity has been added to the photovoltaic industry chain, and polysilicon 1, silicon wafers, cells, and modules** have all shown a downward trend. The polysilicon industry has entered a pattern of low profits. For small polysilicon factories or old production lines, the current cost line is lower than its cost line. Many small polysilicon factories have reduced or even stopped production, especially those that mainly produce P-type products, are facing pressure to retire.
Increase advanced production capacity.
According to the announcement of Tongwei Co., Ltd., the total investment of the project is 28 billion yuan, including an annual output of 500,000 tons of green substrates (industrial silicon 10,000 tons of high-purity crystalline silicon project and supporting facilities. The project will be constructed in phases. Among them, the first phase of the construction of 200,000 tons of green substrates (industrial silicon 10,000 tons of high-purity crystalline silicon project, the first phase of the project is expected to invest a total of 13 billion to 14 billion yuan;The second phase will build 300,000 tons of green substrates (industrial silicon 10,000 tons of high-purity crystalline silicon project. The first phase of the project will be completed and put into operation by the end of 2025, and the second phase of the project will be launched at an opportune time according to market conditions.
Regarding the impact of this investment on the company, Tongwei Co., Ltd. said that the expansion will help the company make full use of the rich natural resources and perfect advantages of the photovoltaic industry chain in Inner Mongolia Autonomous Region, further consolidate the company's position as a world-class leading enterprise in the field of high-purity crystalline silicon business, and promote the realization of the overall strategic goals and long-term sustainable development of the company's photovoltaic business.
Industry insiders told China ** Daily that the expansion of polysilicon production capacity is expected to help the company seize the upward opportunity in the next cycle and further consolidate the company's leading position in the global polysilicon industry.
Lay out and prepare in advance.
At present, polysilicon is in the downward stage. On December 20, the Silicon Branch of the China Nonferrous Metals Industry Association announced the latest weekly polysilicon transactions**. Among them, the average transaction price of n-type materials was 6780,000 tons, 029%;The average transaction price of monocrystalline re-feeding was 6160,000 tons, 112%;The average transaction price of monocrystalline dense material was 5950,000 tons, 116%;The average transaction price of monocrystalline cauliflower was 5610,000 tons, 158%。
As for the reason for Tongwei's expansion at this time, industry insiders said that the construction period of polysilicon production capacity needs to be 15-2 years, longer than the expansion cycle of other photovoltaic links. When there is a change in the demand side of the PV industry, there is often a lag in the adjustment of polysilicon production capacity. Therefore, polysilicon companies will expand production ahead of schedule, which will help them seize the market when demand surges in the PV industry in the future.
The relevant person in charge of Tongwei Co., Ltd. told reporters that after the investment and expansion, the new production capacity needs to be climbed, and it is expected to form an effective output in 2026, grasp the cost advantage of raw materials during the industry adjustment period, and make sufficient preparations for the upward trend of the industrial cycle.
Industry insiders believe that the future growth of the photovoltaic market is certain. Tongwei Co., Ltd. is actively expanding production capacity and will grasp the first-mover advantage and voice at key nodes in the development of the industry in the future, which will help the company further improve its profitability and comprehensive strength, and achieve the goal of "building a world-class clean energy operator".
Small factories are under pressure to exit.
Since 2023, a large number of new production capacity has been added to the photovoltaic industry chain, and polysilicon 2, silicon wafers, cells, and modules** have all shown a downward trend, and the overall profitability of the industry has weakened and entered a state of meager profits. For small polysilicon factories or some old production lines, they are already below their cost line, and there is no hope for profitability in the short term, so many small polysilicon factories choose to reduce or even stop production.
Against this backdrop, polysilicon leaders are still significantly increasing their production capacity. As of the first three quarters of this year, Tongwei has formed a production capacity of more than 420,000 tons of high-purity crystalline silicon, and plans to have a cumulative production capacity of 800,03-1 million tons of high-purity crystalline silicon from 2024 to 2026GCL Technology's granular silicon production capacity has reached 420,000 tons, and it will continue to expand in the future.
Industry insiders told reporters that customers should be treated with photovoltaic overcapacity. "We should not simply look at the nominal scale of polysilicon production capacity, but also look at the effective production capacity under the changes in the market environment. ”
A reporter from China ** Daily learned that in the context of the decline of polysilicon, the investment or production of polysilicon projects planned by some enterprises has been postponed, and the possibility of subsequent termination of investment cannot be ruled out.
Recently, a polysilicon company in Inner Mongolia issued a notice that the company has completely suspended production, and the specific resumption of work is to be determined. The reporter learned that the main reason for the suspension of production is that polysilicon has continued to decline recently, and the company has a technical transformation plan.
The relevant person in charge of the China Nonferrous Metals Industry Association told reporters that the current photovoltaic industry chain technology is shifting from p-type to n-type. Taking polysilicon as an example, the latest transaction situation shows that n-type polysilicon is in short supply, while p-type polysilicon is in oversupply. Looking ahead to next year, the demand for n-type products will increase rapidly. Against this backdrop, companies that cannot produce a high proportion of n-type polysilicon will face greater operating pressure. "Companies that mainly produce p-type polysilicon4 will be under a lot of pressure. The person in charge said.