Dow closes factory, lays off 800 employees! Anti involution fermentation, organic silicon explosion, Hesheng, Dongyue, and Silicon Treasure surged!
Market Overview: The domestic DMC market prices have stabilized, with an average price of 10400 yuan/ton, unchanged from the previous day. Affected by the rebound in silicon metal prices, manufacturers have increased their willingness to raise prices, and some northern enterprises also have expectations of price increases. Although downstream inquiries have increased, there is a strong wait-and-see atmosphere, with weak new order transactions.
Raw material side: The main raw material metal silicon market maintains stability after rising.
Supply side: It is expected that the operating rate of individual factories will increase in July.
Demand side: Downstream wait-and-see sentiment is dominant.
The main contract of polycrystalline silicon futures was closed at the daily limit up in the afternoon, and the main contract of industrial silicon futures also expanded its gains to 5%. The market expects a significant increase in the price of polycrystalline silicon, and mainstream enterprises have suspended quotations for cost estimation. It is widely expected that the price will exceed 39-40 yuan/kg.
The photovoltaic equipment index rose by 5.68% in a single day, and several photovoltaic ETFs rose by over 5%. Daquan Energy saw its highest increase of over 17%, with companies such as Tongwei and Armaton hitting the limit up. Nearly ten individual stocks, including Shouhang New Energy, Yijing Optoelectronics, and Tuori New Energy, also hit the limit up. It is worth noting that polysilicon futures have risen by over 26% in the first half of the month since hitting bottom in June, and have hit the daily limit twice this month.
The collective outbreak of the photovoltaic industry chain this time is the result of multiple factors such as policy adjustments, industry self-discipline, and demand catalysis.
At the policy level, there is a clear signal of strong 'anti internal competition'
On July 3rd, the Ministry of Industry and Information Technology held a symposium, clarifying the need to "regulate low price disorderly competition in accordance with the law and promote the orderly exit of backward production capacity", which is seen as a signal for the launch of the supply side reform 2.0 in the photovoltaic industry. The sixth meeting of the Central Financial and Economic Commission has elevated the rectification of internal competition to a national strategic level. It is reported that the national department has required major photovoltaic enterprises to report their cost prices and warned that sales below cost prices will face heavy penalties, with unprecedented policy enforcement efforts.
At the industry level, the joint production reduction action of top enterprises is significant
According to market news, top polysilicon companies have collectively reduced production through industry self-discipline negotiations, raised prices uniformly, and actively implemented joint price limits. The China Photovoltaic Industry Association has also guided enterprises to sign voluntary production control agreements, which has led to a decrease in the operating rate of silicon materials and wafers, alleviating the pressure of supply-demand imbalance. In addition, news of reduced production of photovoltaic glass continues to ferment, attracting financial attention.
On the demand side, overseas markets are expected to rebound in the short term
The transition period for the cancellation of the new energy tax credit under the "Big and Beautiful Act" in the United States is approaching, triggering a wave of local power plant installation rush, which is expected to stimulate Chinese companies to increase their exports to the United States in the short term. European component prices have rebounded for the first time after months of decline, and the growth rate of installed capacity in emerging markets such as the Middle East and Latin America has increased, which has also eased export pressure.
Despite the high market sentiment, there is still uncertainty in the future of the photovoltaic sector. In the short term, although the expectation of supply side reform has been sought after by the market, the clearance of production capacity has not yet ended, and the contradiction between high inventory and weak demand has not been fundamentally resolved. In the medium to long term, industry competition will gradually shift from "price wars" to "technological differentiation", and companies that lay out the next generation of high-efficiency technologies are more likely to cross cycles.
Regarding the rise in the organic silicon sector on July 8th, the staff of the Securities Department of Silicon Treasure Technology responded that the company mainly focuses on organic silicon, and its downstream products are mainly in the construction and industrial fields. Polycrystalline silicon belongs to inorganic silicon and is related to the photovoltaic industry. The company's business is not involved. At present, there has been no significant change in the fundamentals of organosilicon. The overall price of organosilicon is at the bottom, and any fluctuations in stock prices should be related to market sentiment