The impact of polysilicon prices on energy storage

Overall, the polysilicon market continues to face supply exceeding demand pressure. Currently, prices have already fallen below the full cost line for most manufacturers, and some older production facilities have seen their cash cost lines breached. As a result, several manufacturers have opted to suspend production for maintenance.

One important reason was the impact of the imbalance in the supply-demand relationship of the PV industry chain. Since April 2024, the market price of polysilicon had fallen below the cost of polysilicon producers and had continued to operate at a low level.

The latest polysilicon pricing report from the Silicon Industry Branch reveals a lukewarm spot market with modest price drops. Among silicon products, except for granular polysilicon, all the others saw price reductions—with n-type monocrystalline dense chunk silicon (used for ingots) posting the steepest decline at 2.42%.

Among silicon products, except for granular polysilicon, all the others saw price reductions—with n-type monocrystalline dense chunk silicon (used for ingots) posting the steepest decline at 2.42%. Only a few leading polysilicon manufacturers maintained stable pricing.

“Production costs hover around RMB60,000 per ton, but selling prices can't even reach RMB50,000 (US$6,861). The more we produce, the more we lose.” Such scenes are playing out across China's major polysilicon production zones.

To reduce inventory and generate cash flow, companies may lower prices to some extent. As a result, polysilicon prices are expected to show a slight weakening trend from late 2024 to February 2025. While prices may decrease, the decline is not expected to be significant as companies will need to strike a balance between costs and profits.