Download - Greentech Media Poly Webinar Feb 2012final
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Polysilicon 2012-2016:
Supply, Demand & Implications for the Global PV Industry
Webinar on February 9, 2012
Moderator:Carolyn CampbellResearch [email protected]
Speaker:
Brett PriorSenior [email protected]
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http://www.greentechmedia.com/research/report/polysilicon-2012-2016
200+ Pages120+ Company profiles
90+ Charts, Tables, and IllustrationsHistorical and forecast capacity, cost, and price from 2008-2016
http://www.greentechmedia.com/research/report/polysilicon-2012-2016http://www.greentechmedia.com/research/report/polysilicon-2012-2016http://www.greentechmedia.com/research/report/polysilicon-2012-2016http://www.greentechmedia.com/research/report/polysilicon-2012-2016http://www.greentechmedia.com/research/report/polysilicon-2012-2016http://www.greentechmedia.com/research/report/polysilicon-2012-2016http://www.greentechmedia.com/research/report/polysilicon-2012-2016 -
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1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
Why should you care about the cost of polysilicon?Because lower poly prices and higher module efficiency will shave ~$0.20/W off the cost of a c-Si module in 2012 alone
Forecasts included in the full report
Forecasts included
in the full report
Numbers look too low?Here are the 3Q11 results:
Trina
$0.65/W non-silicon cost $0.37/W silicon cost $1.02/W total cost
Best-in-class conversion
costs by step
Wafer $0.17/W (GCL) Cell $0.17/W (LDK) Module $0.28/W (CSI) Non-Si $0.62/W
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Solar PV manufacturing 101
1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
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Polysilicon manufacturing 101
1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
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Polysilicon industry is concentrated, could be considered abalanced oligopoly
1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
HHI is measure ofindustry
concentration on ascale of 0 to 10,000(10,000 is amonopoly)
A market with an HHIless than 1,000 is
regarded ascompetitive
Poly industry is ~640
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Even with 22 GW of c-Si PV installed in 2011, there still remains significantoversupply at all stages of the value chain
1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
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China, the US, and Korea are the 3 largest producers of polysilicon
1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
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1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
Costs that vary by technology include energy (~13%), and depreciation &interest (~48%)
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1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
Energy use matters, and in this category FBR and UMG win
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1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
But Capex (which determines Depreciation & Interest) is much more importantthan energy use, and on this metric Siemens HC and UMG take the cake
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Lower purity poly sells at a 10-30% discount to higher purity poly
1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
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1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
Excluding Depreciation & Interest, FBR is the cost leader
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But, when depreciation & interest are included, Siemens HC is the lowestcost option
1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
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And on the most important metric, profit, Siemens HC again takes the gold
1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
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Historically, capacity has remained close to total demand
1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
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But in the last 4 years, capacity growth has outstripped demand growth, andthis imbalance may get worse before it gets better
1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
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1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
Profit margins are key to understanding where pricing is headed
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1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
Spot prices are driven by cash costs, whereas contract prices have afloor set by total costs
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1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
Since 2009, cash costs for poly have been reduced from ~$40/kg to
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1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
Depreciation adds another $3-8/kg to manufacturing costs
REC FBR, $20GCL, $21
LDK, $27
Daqo, $22
$0
$20
$40
$60
$80
$100
$120
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 2012
PolyM
anufacturingCost,in
cl
d
epreciation($/kg)
Poly Manufacturing Costs (incl depreciation, excl SG&A), 2009-present
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1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
Poly ASPs collapsed in 4Q 2011, falling over 40% at REC
REC, $57
REC, $35
GCL, $44
Daqo, $52
$0
$10
$20
$30
$40
$50
$60
$70
$80
1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11
PolyASP($/kg)
Poly ASP by Manufacturer, 2010-present
42%
drop
from 3Q
to 4Q
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1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
EBITDA Margins have fallen from very attractive (50-70%) to toxic in just 4 quarters
REC, 51%
REC, 28%
Wacker, 39%
OCI, 70%
OCI, 34%
0%
10%
20%
30%
40%
50%
60%
70%
80%
1Q08 3Q08 1Q09 3Q09 1Q10 3Q10 1Q11 3Q11
EBITDA
Margin,
%ofrevenue
EBITDA Margin by Poly Manufacturer, 2008-present
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1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
Including the impact of depreciation, EBIT margins are now approaching 0%
REC, 34%
REC, 4%
OCI, 57%
OCI, 6%
Daqo, 29%
0%
10%
20%
30%
40%
50%
60%
1Q08 3Q08 1Q09 3Q09 1Q10 3Q10 1Q11 3Q11
EBITMargin,
%ofrevenue
EBIT Margin by Poly Manufacturer, 2008-present
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What is next for the polysilicon industry?
1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
Where is pricing headed?
When will the plant closures allow the supply/demand gap toclose?
The feast is over - which companies are best positioned to survive
this period of famine?
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1. Polysilicon Overview2. Comparison of Polysilicon Production
Technologies3. Polysilicon Supply and Demand 4. Polysilicon Economics
Supply stack analysis can help to reveal the likely winners and losers, as well
as future pricing trends
Cost estimates for every operational poly
plant included in the full report
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Moderator:Carolyn Campbell
Research [email protected]
Speaker:Brett Prior
Senior [email protected]
Q&A