Daqo targeting multi-year development, n-type polysilicon supremacy as ASPs continue to climb

Aug 19, 2021 05:16 PM ET
  • Significant polysilicon producer Daqo New Energy has actually unveiled plans to increase its annual production ability to 270,000 metric heaps (MT) by 2024 while also plotting a course for prominence of the n-type polysilicon market.
Daqo targeting multi-year development, n-type polysilicon supremacy as ASPs continue to climb
Image: Daqo New Energy

The surging polysilicon price has actually been one of the distinguished motifs of the solar industry up until now this year, and it raised Daqo's economic efficiency to tape-record highs in Q2 2021. The poly producer posted profits of US$ 441.4 million in the second quarter of the year, up 72% sequentially as well as more than treble the US$ 133.5 million posted in Q2 2020.

Gross profit additionally soared, rising to US$ 303.2 million for the quarter, an increase of 155% sequentially.

While Daqo's typical production price likewise crept up, climbing about 9% year-on-year to US$ 6.31/ kg, surging ordinary market price (ASPs) of US$ 20.81/ kg aided send the firm's gross margin to 68.7%.

In addition, the preliminary few weeks of Q3 have actually seen ASPs rise greater still, balancing between US$ 26-- 28/kg, motivating president Longgen Zhang to state that pumped up ASPs are set to proceed right into the second half of this year, as well as potentially past.

Zhang stated polysilicon supply was to stay limited throughout the remainder of the year as demand continued to be solid regardless of the boost in rate, responding in the direction of significant solar wafer as well as cell service providers that have actually raised their costs in recent weeks.

Zhang included that according to the company's estimates, in between 180,000-- 220,000 MT of brand-new polysilicon production capacity is to be included 2022, considering possible six-month ramps for its peers. Around 35,000 MT of that nameplate capacity is ahead from Daqo's Stage 4B expansion project, which Zhang said can complete as early as the end of this year prior to being ramped into 2022.

Having bolstered its cash reserves and also elevated around US$ 1 billion via an effective IPO procedure last month, Daqo now plans to capitalise on the high polysilicon price by developing a considerable expansion plan over the next 3 years, putting into place a roadmap for which the business takes its polysilicon outcome to 270,000 MT by the end of 2024. Additional feasible growth websites are to be sought, with even more comprehensive strategies to be revealed at a later day

These expansion strategies are made to help Daqo maintain its existing market share, which the firm said stands at between 18-- 20%.

This included ability, Zhang said, would equate to around 240-- 250GW of total solar component production capacity, with the ability of serving 200-- 210GW of installs next year. Keeping that thought about sufficient to fulfill need, Zhang informed experts on a teleconference the other day that ASPs are expected to fall into 2022 as the tightness in polysilicon supply falls.

Daqo expects to become aware ASPs of around RMB150/kg (US$ 23) in H1 2022 and around RMB130/kg (US$ 20) in H2 2022. The firm offered no additional insight into possible ASPs past H2 2022, suggesting it would depend on both continuous supply as well as demand pressures along with the polysilicon sector's capacities of delivering n-type polysilicon, with the solar market transitioning in the direction of n-type modern technologies.

Cooked into Daqo's expansion strategy is a commitment to catering for n-type solar-grade polysilicon need. Zhang said the company is currently delivering n-type polysilicon to 4 of its significant customers, with such item setting you back around an extra RMB2/kg (US$ 0.30). While it currently has the capacities of providing between 30-- 40% of its result to n-type polysilicon, Zhang claimed Daqo could increase this further-- to around 70-- 80%-- based upon market need.

In action to the continued high need for polysilicon, Daqo has enhanced its advice for the complete year from 81-- 83,000 MT to 83-- 85,000 MT, and also the business anticipates to fully utilise its facilities throughout 2021.

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