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Weekly Price Analysis – Edition 10th Aug 2020

Indian Cell and Module Market – Current Demand & Supplies

The notification for implementation of BCD (Basic Customs Duty) on import of solar cells and modules has been delayed due to differences among various stakeholders on quantum of duty and the ‘grandfather’/ pass through clause. According to latest reports, the Govt is contemplating 10% duty on imported modules and 5% duty on imported solar cells. However, the Govt has yet to conclude how to address issues of WTO and FTA agreements for imposing the BCD. Further the solar global supply chain has been grappling with sharp price rise of input materials especially of polysilicon, wafers and silver paste.  

Imported Supplies

The price of imported solar cells of multi and mono has been shooting up since the last couple of weeks. The FOB China price of 18.8% multi cells is roaming around USD 0.325/- per pc. However, the price rise of mono cells has been steep in comparison to multi cells. Whereas, the prices of imported solar modules have not started shooting up significantly though input costs are already up since the last couple of weeks. Though this price trend of imported modules would not remain for a longer time. Further, with the opening of SNEC 2020 in China, the industry trends for next year has been becoming clear regarding the wattage (600 plus Watt) of imported modules and new cell technologies (HJT, TOPCon, IBC-HJ). These changes would significantly change the dynamics of the solar industry in India as well.      

Local Manufacturing

The euphoria for local manufacturing has been becoming louder as Reliance Industries is also going to announce its entry in the solar sector by Oct 2020. This clearly indicates that the announcement of BCD will happen before Oct 2020. The entry of the PM’s pet man could be a game changer for India as massive investments are required for the solar manufacturing sector if we want to compete with China. The local manufacturers, especially SME players need to remain on their toes in order to stay intact in the solar manufacturing sector in times to come. International collaborations must be formed for R&D in the solar sector. Investments in manufacturing of polysilicon and ingots should not be delayed anymore. The current scene in the local manufacturing sector looks intact as the majority of the capacities have been dedicated for DCR projects. The solar manufacturing units in SEZ are still wary of conversion of their units to DTA or not under BCD regime.        

Demand

The large scale SECI Tenders have been keeping the solar market demand to significant levels. COVID conditions have been keeping the household demand under potential. The demand for DCR orders for solar cells and modules have been a savior for the market. The policy clarity about BCD plays a major role in creating a long term demand in the country.  

Impact on Solar Cells and Solar Module Pricing

The dollar exchange rate is stable between Rs. 74.50 to Rs. 75.25. The prices of DCR solar cells have inched up by a notch due to prices of wafer and silver paste. The prices of DCR modules should follow the suite soon as other module input costs are started upwards as well.  However, the current prices of local non DCR multi 330/335 watt modules by Tier-1 and Tier-2 local manufacturers have seen around Rs. 16.00 to Rs. 16.50 per watt whereas non DCR mono PERC 380 watt modules are available around Rs. 18.25. However, the price rise of modules is imminent considering the sharp rise in input costs.   

See you next week for the next analysis of the prices. Stay at work safely. Best Wishes.

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