Event 1: According to ** report, some manufacturers and distributors have notified that the price of downstream photovoltaic modules is about to rise, with a range of about 2 cents, and some module versions are in short supply and out of stock. 1. As far as we know, it is currently a tentative increase, and whether the price increase can be successfully confirmed by the downstream is yet to be confirmed, but the module has the basis for price increase: a) the demand is improving, and the production is scheduled according to the current schedule; b) The head enterprise loses money on the delivery of low-price orders at sight; c) The difference in module cost is the largest, and the second and third lines are under greater cash pressure. In summary, we believe that it is only a matter of time before module prices rise, as we have repeatedly stressed that module prices will definitely increase.
2. Previously, we believed that the price increase of some links in the industrial chain in the second quarter could be expected, including modules, TOPCon batteries, adhesive films, etc. At the same time, n-type polysilicon & wafers are expected to maintain a relatively tight balance due to the increase in the proportion of TOPCon, and the premium will remain good. The current module price increase is the most critical to realize the early logic, which supports the price increase of all upstream links. 3. The core reasons for the analysis are the booming demand: 1) European inventories continue to deplete, and module leaders reflect that inventories are expected to deplete to normal levels; 2) Non-European and American overseas installations continued to be strong, and the shelving of special Indian ALMM drove strong demand; 3) The bidding for domestic projects is expected to start in March. In addition, during the Spring Festival, the industry's inventory has been removed, and the seasonal production schedule after the holiday also has a certain pulling effect.
4. The production schedule we have tracked confirms this point, and the production schedule of modules and auxiliary materials has improved significantly in March. Module production in March is expected to be around 45-50GW, and there is no lack of possibility to further exceed expectations, among which the TOP4 is expected to be above 7GW on average, an increase of 60%-80% month-on-month, higher than the production schedule in January. Other module makers' production schedules in March were also similar to or higher than those in January. In terms of auxiliary materials, the demand for leading orders for adhesive film is strong, and it is expected to be close to full production in March, and some second-tier orders are also expected to be close to full production, which is a significant improvement from the previous state; The inventory of glass faucets in February remained at about 2 weeks; Enterprises such as welding strips and junction boxes also said that the demand in March was more optimistic, with a significant increase from February.
Event 2: The film faucet made it clear that the price will rise one after another this week and next week, with an increase of less than 10%; According to SMM data, some manufacturers have raised prices this week.
1. The price increase is mainly due to: the demand side: module production in March increased by more than 50% month-on-month, and the film faucet and some second-line orders were full, and the leading share exceeded 50%. Cost side: According to Zhuochuang data, the particles after the festival range from 200 to 500 yuan, of which the photovoltaic particles are 1000 yuan from the previous low point (still upside down compared with other grades). According to the conventional pricing model of adhesive film, the new order of adhesive film depends on the spot particles, and the adhesive film factory has the demand for the cost of conductive resin;
2. The profitability of the film has bottomed out: according to the calculation of the spot **, if the price rises by 5+%, the transparent EVA film is expected to have a small profit, and the actual inventory cost lags behind the first and the monthly shipments in March account for a relatively high proportion, and the Q1 profit of the film company is expected to improve month-on-month! Looking forward to the follow-up, module production scheduling will continue to be upside, and the particle supply will only be a set of 250,000 tons of Baofeng equipment (accounting for 10% of the domestic nominal production capacity) during the year, and it is expected that photovoltaic particles** may be tighter than in 23 years, and particle** uplink cycle adhesive film enterprises can enjoy a certain inventory benefit (while the inventory cost in 22 years is high and has a reduced value);
3. The market share of the leading company in 23 years has returned to more than 50%, and the profit is even further expanded compared with the industry average, showing the absolute competitive advantage of the leader. The leading company has solid advantages in new technology, cost and capital, and its growth point in the non-photovoltaic field is also worth paying attention to. Continue to focus on recommending Foster, with a profit of 2.5-2.8 billion in 24 years, less than 20 times the valuation; The film pattern has basically been cleared, and the profitability of the second and third lines may improve compared with 23 years.
Event 3: In the past two days, the market has paid more attention to PV production scheduling, mainly due to the sharp increase in European module orders since February, more centralized projects, and the demand for household storage in South America and microinverters in Brazil have increased significantly in recent weeks.
1. Recently, the market has paid more attention to the module production schedule in March, and this data will be relatively clear at the end of the month, especially in the last week of auxiliary materials, but there will be a general direction judgment before;
According to industry feedback, we objectively expect that the production schedule of major PV companies in March will increase by 30%-35% month-on-month, and individual enterprises may grow at a higher rate, with module production scheduling of 41-46GW in March. The specific production schedule may fluctuate, and it will be clearer after the fifteenth day of the first month;
3. Compared with the specific production scheduling data, it should be noted that the market has gradually changed from ignoring the changes in the photovoltaic industry to paying attention to changes;
After the holiday, various industries have started construction one after another, and we track the production schedule of photovoltaic module companies in March as follows: (Considering the impact of factors such as the holiday in February, more data will be compared with January) a: Compare.
15-20% increase in January; b: Unchanged from January; C: Orders are relatively abundant, but they are still being discussed due to factors such as **; D: 33% increase from the previous month.
On the whole, the industry's production schedule has basically returned to the pre-holiday level, and domestic demand has recovered after the holiday, while the European inventory feedback is expected to return to a reasonable level from March to May.
Interpretation by experts on photovoltaic production scheduling in March.
Monthly production schedule: Modules: The production schedule is expected to be 45GW+, and the radical point will reach 50GW+, with a monthly increase of 50%+ (the growth rate of the head is significantly higher than that of the second and third lines, and the top four companies have a production schedule of 7+GW in March, the highest exceeding.)
8gw）；Battery: Production is expected to be 53-54GW, a 30% increase month-on-month; Wafers: Production is expected to be 57GW, a slight increase from the previous month;
Polysilicon: Production is expected to be 160,000-170,000 tons, a slight increase from the previous month.
2. Reasons for module production scheduling: 1) Considering the shipping cycle, the production schedule will be increased to meet overseas follow-up demand; 2) Modules are at a low level, and the stock of state-owned enterprises has increased;
3) Distributed demand was strong from January to April.
3. Price increase expectations:
Some module makers are doing well in order and are promoting module price increases to the downstream. N-type batteries have been slightly tightened recently and may follow the price increase; It is difficult to increase the price of polysilicon and wafers.
Q: What is the recent production schedule of photovoltaic cell modules? How has the market share of n-type cells and modules changed?
A: Recently, the production schedule and procurement ratio of n-type modules have increased. According to the latest bidding data, the proportion of n-type modules has reached 667%, and most stations said they would adjust the procurement ratio to more than 60% to 70% this year. Through our analysis, the proportion of n-type batteries has reached 26 in 202357%, with TopCon cells accounting for nearly 25% of annual production, with an estimated annual production of 157 gigawatts (GW) and 135 to 137 GW of Topcon cells. At present, judging from the available data. The proportion of n-type cells has grown rapidly, jumping from 48% to 61% in January and nearly 63% in February. Considering the rapid power replacement of large construction plants, the increase in the n-type ratio may moderate in the second and third quarters.
Q: What about n-type cells and modules?
A: The demand for n-type modules is growing rapidly, and the production schedule for n-type modules in March is expected to reach 30 GW. In terms of **, the effective output of Topcon cells is expected to reach full production levels in the second quarter, with a monthly output of about 35 to 36 GW in February and March, with an average production efficiency of more than 247% to meet the current demand. However, the market is worried about whether N-type batteries are sufficient, especially in early March, as some battery factories are in the stage of resuming work and production and adjusting production efficiency, there may be a short-term shortage of supply, driving ** slightly**. In the long term, we do not expect a market shortage of TOPCON and N-type batteries.
Q: What is the switching speed and prospect of n-type battery?
A: For the pure export of battery Guangjia, the proportion of N-type continues to increase, some manufacturers have stopped or eliminated the P-type production capacity, and some are carrying out P-to-N transformation. Most of the newly commissioned battery factories are invested in n-type and do not have p-type capacity, and these new production plants can make up for the downstream demand for n-type batteries. However, these factories may still be in the ramp-up stage, and their output and capacity are expected to be discounted. For module manufacturers, the recent increase in foundry costs has been relatively good, and even if the battery** remains stable, it also indicates an increase in capacity utilization, but it may affect the export of some products**.
Q: What are the future trends in the market and module scheduling**?
A: We are optimistic about the market demand in the second quarter, and it is expected that module production schedules will continue to grow, and the fourth quarter is also bullish. The module inventory problem, which was previously worried, has now been digested by the market in January and February, and is now at a more reasonable level. With the increase in demand, the industry chain is at a relatively low level, and module manufacturers' willingness to schedule production has also increased. In the future, some manufacturers may not accept the goods at low prices due to increased demand and sufficient orders, and are ready to increase prices. The increase in market demand in March may be due to the fact that the market demand is low, overseas demand is picking up, and there may be a phenomenon of preparing warehouses in advance, and the market is expected to show a positive trend. It remains to be seen whether the market will be able to absorb the total module production schedule of 45 to 50 GW in March, but the overall view is positive about the demand increase.
Q: What are the reasons for the larger-than-expected PV module production schedule in March? Which market has seen a significant increase in demand?
A: The larger-than-expected PV module production schedule in March was mainly driven by various reasons. First, actual demand is indeed rising, both in terms of procurement and installation, but it is still relatively far away. Including the advance procurement of overseas markets, in order to adapt to the increased demand for stocking caused by the extension of the shipping cycle, as well as domestic power stations, in the second quarter of the bidding and procurement also tend to make inventory reserves in advance, especially when the current material ** is low. In addition, the demand for the distributed market from January to April is still strong, and the motivation of dealers to take goods has increased. Overall, this increase in demand has led to an increase in module manufacturers' production schedules, led by an increase in orders from leading manufacturers. The increase in production scheduling of these enterprises remains at a low level under the pressure of the market, and such a high level makes it difficult for some second- and third-tier enterprises to improve synchronously, which has a certain inhibitory effect on their operating rate.
Q: What is the sustainability of the quality of downstream scheduling, including demand and scheduling in April and the second quarter?
A: The overall ** emission output of photovoltaic modules for the whole year is about 627 GW, which is a significant increase from last year, and there may be an increase of 100 GW. We expect a resumption of production schedules in April and May, but there may be destocking needs in June and July. Overall, the module market is expected to increase this year, especially the increase in n-type module production capacity and the increase in monthly production, resulting in production growth likely to be higher than demand growth. The increase is mainly due to the increase in production schedules of leading enterprises. While the market as a whole showed a positive trend in the first half of the year, we expect that a moderate amount of destocking will still be required in the future.
Q: What is the overall inventory level of PV modules now?
A: Domestic inventories began to decline in the third quarter of last year, and fell to about 30 GW a year ago, which is a decrease from last year's highest level of more than 45GW. The inventory level of 30 GW is neutral and not low, and the involvement of intermediaries also has an impact on inventory levels. In terms of global inventories, the European market is a major reference point, with inventories declining from the third quarter of last year to the Chinese New Year, and the overall global inventory is estimated to be around 70 GW before the year. Despite this, the current inventory levels are slightly on the high side.
Q: Why is wafer production still high, while downstream cell production has been reduced?
A: There are two main reasons for the continued high wafer production schedule: first, the market is worried about the shortage of wafer production in the past year, which has led to a large number of wafer factories purchasing polysilicon and a decline in inventories, while polysilicon mills have an increase in inventories and need to maintain production to check and adjust inventories. Second, wafer manufacturers are generally optimistic about the market prospects, especially worried about the shortage of n-type wafers, so they buy polysilicon while producing. In addition, the production schedule of cell factories in January was relatively high, reaching nearly 52GW, so wafer factories maintained a high operating state in order to meet future demand.
Q: What was the production ratio of n-type products of module makers in March? What is the average n-type scheduling ratio of other companies?
A: In March, overall, the production schedule ratio of n-type products is expected to reach more than 65%. If we exclude the leading enterprises with the highest proportion of n-type, the proportion of n-type products of other enterprises is between 60% and 65%.
Q: What is the inventory situation of cells? Do you split different types of inventory data?
A: At present, the inventory situation of cells is complicated. It is difficult to obtain inventory data for integrated enterprises due to their own production and self-use. Most battery plants did not stop production in February, so production is high. The leading enterprises still maintain high production schedules and some of them purchase or outsource production. Some companies may be digesting the battery inventory produced at the end of last year, and lack orders, which is called "non-tradable inventory". Generally speaking, cell inventories need to be analyzed on a case-by-case basis and cannot be generalized.
Q: How do you view the follow-up industrial chain? Is there an expectation of a price increase?
A: In the short term, modules** are expected to rise steadily in the second quarter, affected by the increase in batteries**. Polysilicon and wafers are expected to be flat or slightly lower in the short term. In the third quarter, as high production schedules in the early stage may lead to inventory accumulation, module and cell prices are likely to stabilize, and polysilicon is expected to reach a stage bottom. And batteries may be due to the centralized procurement period of n-type products and the demand for profits. Recently, some companies have been promoting price increases, because the increase in orders but the price of cells is too low, which may lead to an increase in cell prices if the module price follows that of major manufacturers, especially for n-type cells.
Minutes**: Wen Bagu Research] Mini Program