Solar glass prices to stabilize as trade sanctions bite, says IHS

Plunging solar glass prices caused by a China-led oversupply in the market will be reversed next year as tariffs imposed by the European Union (EU) begin to bite.

Average global prices for glass used in solar PV have fallen by around 50% since 2009, dropping to approximately $4.60 per square meter this year from a high of $10.40 in 2009. However, as countervailing duties (CVD) imposed by the EU on Chinese suppliers begin to take effect, solar glass prices will stabilize in 2015 and will increase to $5.90 per square meter by 2018 – an 11% increase on this year’s lows.

This data was presented in IHS’ Module Innovations to Create Opportunity for PV Material Market report, which outlines future trends in the solar PV industry.

IHS forecast that the EU’s CVD levy – which range from 3% – 42% depending on the level of subsidy each solar glass company received from China during the glut years of 2009-2013, will slow Chinese dominance of the solar glass market, but only slightly.

In 2014, Chinese manufacturers account for an estimated 27% of the total solar glass supply in Europe – up from just 2.5% in 2010. This year, more than 90% of imported solar glass into the EU has come from China, where government subsidies have enticed many Chinese glass manufacturers to enter the solar glass segment with often aggressive pricing strategies for overseas markets.

"The sharp drop in solar glass prices during the last five years was the result of massive oversupply in the market," said IHS’ solar research analyst Karl Melkonyan. "Chinese government subsidies on solar glass caused domestic suppliers to increase production and exports.

"However, the EU’s move to impose CVD on solar glass imported from China will limit supply in the market, leading to an expected increase in prices."

A touch of glass

Chinese suppliers have cornered 55% of the globe’s flat glass supply, followed by European manufacturers with 16% of the global demand, which reached 47.6 million metric tons in 2013.

Developments in the solar glass industry are notably strong in the anti-reflective coating (ARC) sector, revealed IHS. The analysts calculate that ARC solar glass will account for 85% of the solar glass market by 2018 as more and more solar companies opt for the higher output, lower cost-per-watt performance of ARC glass.

Having performed poorly in 2012, ARC glass has enjoyed a growth rate of around 50% over the past two calendar years, said IHS.