China: Fight against price war causes solar panel costs to rise 15% in one week.

Prices for photovoltaic modules rose 15% in less than a week in China, amid a shift in the behavior of the country's solar industry.

The move comes after a series of measures adopted by the Chinese government and manufacturers to curb the so-called "involution," a term used in the country to describe excessive competition that has led companies to lower prices even in the face of negative margins.

In practice, the Chinese industry is trying to stop a long price war that has driven down the prices of photovoltaic equipment in recent years.

The movement began with the raw materials and components used in the manufacture of the modules and has been advancing through the production chain. It all started on August 6th, when major polysilicon manufacturers signed an initiative against the so-called "devolution".

The companies pledged not to sell products below costs calculated based on industry-defined standards. That same day, module manufacturers began adjusting their prices.

The decision was made a week after four Chinese regulatory bodies participated in a meeting in Yancheng on July 31st to discuss the issue of price controls in the sector. At that meeting, guidelines were released to establish parameters for calculating the costs of the photovoltaic industry.

Price war has reached its limit, says source.

A source connected to the manufacturing sector in China, interviewed by Canal Solar explains that the current movement occurs after a year marked by oscillations.

In the first quarter, prices rose, pressured by, among other factors, commodities and the end of tax benefits for Chinese exports.

Subsequently, with weakening demand, prices fell again, once more reaching levels considered unsustainable by manufacturers.

“We have reached a new limit, which is why this movement is now, with a sharp increase in prices aimed at preventing the regression of the entire chain. In general, manufacturers are selling below cost, leading to significant losses in the chain,” he states.

According to the source, the pressure on margins is also beginning to affect companies' ability to invest in the development of new technologies.

"Because of this, the entire chain stagnates in terms of technology. In other periods, module technology updated much faster. Currently, it is no longer changing because companies do not have the resources to invest in new technologies and their production lines."

High energy begins to travel along the solar chain.

A source heard by Canal SolarIt points out that the effects have already begun to appear at different stages of the modules' manufacturing process.

Polysilicon, the main raw material used in the production of silicon wafers that form solar cells, was one of the first products to react, with futures contracts for the material rising 9% in a single day last week.

According to information from Mysteel, a Chinese agency specializing in commodity prices and data, manufacturers also made new adjustments this Wednesday (12).

A day later, major producers raised their prices again in an attempt to support the new levels. The effect is cascading: if raw materials, wafers As cells become more expensive, so does the pressure on the manufacturing cost of the modules.

Silver and exports were already putting pressure on costs.

The action taken in recent days comes after other factors have put pressure on the costs of the Chinese photovoltaic industry in 2026. In March, market sources already pointed to the appreciation of silver, used in the manufacture of solar cells, as one of the pressures on costs.

Rise in solar panel prices: what changes for the photovoltaic market?

Another factor was the end of a 9% tax benefit granted to Chinese exports of photovoltaic products, which expired on April 1st. This change increased the costs associated with products destined for the international market.

At the same time, manufacturers began to signal a change in strategy, demonstrating a greater willingness to reduce production volumes rather than continue selling equipment below cost.

Price increase: Chinese incentive for modules and batteries comes to an end.

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