PV suppliers can expect some relief by late 2013, IHS says
PV module suppliers that can hold on until the latter half of 2013 can expect to finally see some relief from falling prices and chronic overcapacity, says analyst IHS iSuppli.
IHS says that after “another two tough quarters at the beginning of next year” the hard-pressed global manufacturing sector will see the decline in PV module prices slow, and then stop in the back half of 2013.
The huge capacity expansion that has characterised the last few years will halt, and “overcapacity will have less dramatic repercussions in 2013 than during this year, even if the issues will continue to be of concern", predicts IHS's PV Integrated Market Tracker Report, adding: “The players that remain should return to profitability”.
By the fourth quarter of 2013, average crystalline module prices are forecast to reach $0.55 per watt, down 14% on the same quarter in 2012. That compares to a 32% fall between the fourth quarter of 2011 and the final three months of this year.
IHS predicts that after falling throughout 2012, global module revenues will bottom-out in the first quarter of next year and then recover.
By the fourth quarter of 2013, revenues are forecast to surge back past the $7bn mark. IHS says that although this is still well below the $10bn level exceeded in two high-water quarters of 2010, “it nevertheless marks the reversal of a trend that will help the most competitive suppliers to noticeably increase their profitability in the second half of 2013”.
But before growth and profitability resume, the industry will have to deal with the tail-end of the bad times, warns IHS.
It expects global revenues will fall again in the fourth quarter of 2012, despite an increase in installations that will take this year’s global total to about 31GW, 11% up on 2011’s level.
IHS expects c-Si modules to fall a further 9% in the quarter, to reach $0.64 per watt at the end of 2012.
Two major factors are behind this, according to Stefan de Haan, principal analyst at IHS.
“First, demand in the fourth quarter will be fuelled by installations in China. But while many delayed solar projects in the country will be implemented during the remainder of the year and help improve global installation figures, China is a low-priced market.
“As a result, even a strong fourth quarter in China won’t induce a recovery in prices,” says de Haan.
Chinese manufacturers are already reducing module shipments to Europe, in response to a possible European Commission investigation into imports from China, adds de Haan.
While IHS does not expect any duties to actually be imposed, the uncertainty will contribute to downwards pricing pressure on Chinese modules, he says.