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Severe flooding in southeastern China forced the closure of a facility owned by manufacturer Tongwei Solar, causing a further impact on the supply of polysilicon.
About a month ago, Canal Solar reported explosions in facilities belonging to GCL-Poly which also affected the supply of polysilicon, increasing price volatility and affecting module manufacturing cost control.
Tongwei confirmed that it has halted operations at its 20,000 MT (metric ton) polysilicon factory in Leshan city, Sichuan, after a Level 1 flood warning was issued by local authorities.
In a statement, the company said it was instructed to stop production immediately by the province's local emergency management department, assuring it had evacuated all workers from the facility pending further instructions.
Combined with high global demand, this new drop in supply in the photovoltaic cell industry will cause a further increase in module prices.
This is a reflection that can already be observed in some companies in the sector. Tongwei, for example, recorded an increase in the prices of polysilicon (raw material for the photovoltaic cell). The high was 11%, with 0.6 yuan (R$ 0.46) per watt.
The company also recorded an increase in the cost of three types of monocrystalline cells by 0.08 yuan (R$ 0.64) per watt each, an increase of around 9%. The increase is the second in less than three weeks after the July 24 price increase.
Polysilicon prices have risen by almost 50% since July 15, to about US$ 10 a kilogram, according to data compiled by BloombergNEF. This is the highest level since October 2018.
More raises
According to a survey carried out by BloombergNEF, LONGi, a global manufacturer of solar wafers, also increased prices for the third time in a month and said it will continue to increase them if polysilicon costs continue to rise.
The company, based in Xi'an, China, recorded two types of monocrystalline wafers at around 7% each. Costs have risen by 24% and 23% since July 19, when the GLC-Poly factory explosion cut global supply and prices soared.
For the first time, LONGi released its wafer and polysilicon prices, saying that every time the cost of raw materials goes up or down by 3 yuan (R$ 2 reais) per kilogram, its wafers go up or down by 0.05 yuan (40 cents) per piece.
