JinkoSolar Signs Nearly $30B Well Worth Polysilicon Supply Contracts in a Month

Sep 14, 2022 11:44 AM ET
  • To safeguard long-lasting polysilicon supply, JinkoSolar has inked a significant polysilicon supply take care of a worth of more than RMB103.3 billion (US$ 14.9 billion). This comes just weeks after it signed a similar contract with Xinte Energy for RMB102.1 billion (US$ 14.7 billion).

On September 10, JinkoSolar proclaimed that it had entered into a signed purchase agreement with Tongwei for about 382,800 MT of polysilicon items from the company's subsidiaries.

To safeguard lasting polysilicon supply, solar panel maker JinkoSolar has inked a considerable polysilicon supply deal with a worth of more than RMB103.3 billion (US$ 14.9 billion). This comes only weeks after it authorized a comparable contract with Xinte Energy for RMB102.1 billion (US$ 14.7 billion).

On September 10, JinkoSolar stated that it had actually participated in an authorized purchase agreement with Tongwei- globe's largest polysilicon distributor, for regarding 382,800 MT of polysilicon products from the company's subsidiaries.

The general contract value is anticipated to be around RMB103.3 billion based upon the ordinary transaction cost of RMB305,100/ MT (US$ 44,010/ MT) for Chinese mono-dense poly material reported by the country's Silicon Industry Branch of China Non-Ferrous Metal Industry Association (estimation excludes tax and does not constitute a price commitment). The utmost deal will certainly depend upon the total trading quantity and also the real purchase rate, which will certainly be agreed upon every month.

The notification mentions that the previously mentioned contract is a long-lasting purchase agreement that will last from this month through December 31, 2026. When the agreement goes into pressure, the current Polysilicon Purchase and also Sales Framework Agreement in between JinkoSolar, its subsidiary Sichuan JinkoSolar, as well as Tongwei will instantly end.

According to JinkoSolar, the contract was signed with a subsidiary of Tongwei, a key provider of polysilicon products, as well as both business have an effective long-lasting tactical alliance.

On August 26, less than 2 weeks back, JinkoSolar made another significant polysilicon purchase announcement. From 2023 to 2030, Xinte Energy would certainly offer 336,000 MT of indigenous polysilicon to JinkoSolar as well as its affiliates for an estimated RMB102.1 billion.

Therefore, in less than a month, JinkoSolar has actually comitted to invest greater than RMB200 billion in securing polysilicon product. The business's earnings are considerably influenced by changes in the cost of silicon as well as other raw materials, as specified in its H1 2022 report. If the firm's stock is not properly taken care of and also the cost of upstream raw materials fluctuates considerably, the company's inventory price might decrease or manufacturing prices may change, which would certainly decrease incomes.

This year, silicon rates got to a ten-year high. To prevent misconceptions as well as overinterpretations, the Silicon Industry Branch of the China Non-Ferrous Metal Industry Association revealed in a notice on September 8 that it has actually chosen to delay the magazine of polysilicon rates starting this week.

Before the announcement of the quit, polysilicon costs had boosted for 29 successive weeks this year without showing any type of signs of a modification, reaching a ten-year high.

Many industry experts anticipate moderation to begin with 2023, when brand-new capacities should begin coming online. Nonetheless, the brand-new capacities will certainly enter a market starving for more solar, making it very difficult to anticipate actual impact on rates.

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