False alarm: No panel shortage coming


Is the solar industry really facing a looming global module shortage? The answer is no, says Stefan de Haan, solar analyst at IHS Technology.

De Haan rejects recent news articles that have reported depleting supplies of solar modules around the world and a reversal of the glut that resulted in a plunge in prices.

While de Haan was quoted in the reports, he told pv magazine that the impression given by the recent stories are wrong. Setting the record straight, de Haan said the cell and module glut had certainly dried up and there was no longer a massive overcapacity.

"However, we don't see a shortage coming up, current capacities are still sufficient to serve a 2014 market of 45.5 GW, which is the forecast in our most likely scenario,” de Haan said, adding, “So, in 2014, the market is pretty balanced, as installation markets are continuing to grow, and there have been no major capacity expansions last year, which helped the supply demand gap to close.

Recent reports have predicted the scarcity would benefit the world’s biggest solar manufacturers, including China’s Yingli Green Energy and Trina Solar, and likely slow development outside the top markets in Asia and North America.

Addressing the state of the market, the IHS analyst said that after a relatively slow first quarter, global utilization rates are improving and he predicted they would increase continuously for the remainder of the year.

"For the cell industry we see global factory utilization at 85% in Q4 2014, for the module industry we see it at 75%. These values indicate good business and a healthy situation, but not a real shortage. The leading cell and module manufacturers are operating at full utilization, of course."

De Haan added that he did not foresee major supply bottlenecks, but in a very optimistic case leading to a global market in excess of 50 GW, wafers and cells could become short. “This would require in particular the Chinese and Japanese markets to develop stronger than we currently expect it. A Chinese market of 15 GW and a Japanese market of more than 10 GW are not totally impossible, but very unlikely."

Prices came down substantially in the first months of the year, which further supports IHS’ view that supply shortages are not to be expected. “With global installations picking up strongly in the second half of the year, we expect prices to harden. They will stabilize at the current level or drop only very moderately in the coming months."

De Haan anticipates a new capital expenditures cycle materializing in 2014. "In particular the leading players are in expansion mode again. This is important and necessary, as end markets will keep growing. Thanks to these capacity additions, our current projections don't indicate a supply shortage next year either."

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