News Article
Polysilicon Prices May Drop
Solar panel makers and large end users are hit by credit crisis.
Prices of polysilicon, already pressured by a coming supply glut, are dropping fast as the credit crisis drives down demand for the solar panels that are the biggest users of the raw material. Polysilicon has fallen rapidly in past months, dropping to about $200 per kilogramme from approximately $450 earlier this year, say analysts and solar module makers.
And they are likely to fall even further as a flood of new polysilicon supply makes its way out of production, encouraging solar panel makers to renegotiate contracts that account for the bulk of their materials purchases. Thomas Weisel Partners expects spot prices to sink below $100 by the end of 2009 and to a $50 to $80 range in 2010, or nearly the same levels as prices in long term contracts. Such a drop marks a dramatic reversal in the cost situation solar panel makers have faced for the past four years, when polysilicon prices surged and buyers often had trouble finding enough product. Polysilicon, once mainly used by semiconductor makers, became a hot commodity after global warming concerns and energy prices caused a boom in demand for solar panels. But declining costs may not be enough to bring back investors to solar module makers.
Stocks of solar panel makers and their silicon suppliers sold off sharply last week on concerns that the credit crunch was causing investors to shelve new solar development projects.
And they are likely to fall even further as a flood of new polysilicon supply makes its way out of production, encouraging solar panel makers to renegotiate contracts that account for the bulk of their materials purchases. Thomas Weisel Partners expects spot prices to sink below $100 by the end of 2009 and to a $50 to $80 range in 2010, or nearly the same levels as prices in long term contracts. Such a drop marks a dramatic reversal in the cost situation solar panel makers have faced for the past four years, when polysilicon prices surged and buyers often had trouble finding enough product. Polysilicon, once mainly used by semiconductor makers, became a hot commodity after global warming concerns and energy prices caused a boom in demand for solar panels. But declining costs may not be enough to bring back investors to solar module makers.
Stocks of solar panel makers and their silicon suppliers sold off sharply last week on concerns that the credit crunch was causing investors to shelve new solar development projects.
