Indian Cell and Module Market – Current Demand & Supplies
The global solar supply chain has been going through a tough time due to COVID-19. The pandemic has severely impacted the global demand putting a greater amount of pressure on prices of polysilicon to solar modules. The Chinese solar market has been witnessing price slide for the past couple of months. This has been mounting pressure on Chinese tier-2/3 companies to shut their operations as well. The conditions in Indian solar market are expected to work on similar lines in the times to come. However, the government led solar projects are expected to play a major role under current conditions in India.
Imported Supplies
The imported supplies of solar cells and modules would be expected to remain under uncertainty of Safeguard Duty (SGD) as we are heading towards the deadline i.e. 29th July 2020. The countdown of SGD has really begun? We are left with 60 days of protection from the onslaught of Chinese imports once again? These are billion dollar questions before the Indian Solar Industry. Or the Government of India would intervene in this matter and extend the SGD without further investigations; the rules are silent under force majeure conditions. The uncertainty of SGD would definitely impact the imported supplies of solar cells and modules. The buyers would like to wait for next orders for imported solar cells and modules till the clarification from Govt comes in. The lifting off of SGD could be a challenging decision for Govt and if it happens, could impact a few players in the market severely. Let’s hope for the best.
Local Manufacturing
The local manufacturing of solar modules has started in most of India with average capacity utilization of 30% to 40%. Most of the module factories have started operations for completing their pending local/ export orders. These units have been facing an uphill task of keeping the factories running without getting infected with the virus, further adding a delta to cost of production. A few of tier module companies along with a solar plant developer have been showing intent to set up GW level cell factories in India due to huge DCR demand in the pipeline in the next 3 to 4 years.
Demand
The overall solar cells and panels demand conditions in the country still are under the shadow of lockdown conditions. However, with the opening of Government rooftop tenders in some states like Rajasthan could rekindle the hope for SME players in the market. The final bid pricing for these tenders has been clearly showing the cut throat competition in this segment. eSun Solar sees such prices are impractical in the long run. The orders for DCR cells and modules would be expected to remain intact in the coming months. The supplies of imported modules by aggregators like Redington and Evolve almost find no buyers in the market at the moment.
Impact on Solar Cells and Solar Module Pricing
The price slide in China has also been impacting prices of solar cells and modules in India as well. The market is currently restricting to price inquiries only as not much actual demand has been seen. Further, the forecast of dollar exchange rate is expected to be between in the range of Rs. 76. The prices of DCR multi 330 watt modules have started cooling off to the levels of Rs. 20.50 from Rs. 21.50 per watt due to lack of demand. The prices of imported modules are expected further sliding in India as well due to falling prices of wafers and cells in both mono and multi variants.
See you next week for the next analysis of the prices. Stay home and Stay safe. Best Wishes.