Weak demand for global solar market in 2011

Compared with the annual growth rate of 139% in 2010, the global solar market demand in early 2011 appears to be relatively weak. According to preliminary estimates, the demand for Germany's Q1'11 terminal market is still less than 50% of the same period of last year. This year, in some regional or national markets that are optimistic about this year, it seems that the price decline rate has not yet effectively stimulated the growth of market demand. Nevertheless, Solarbuzz is still optimistic about the second quarter market, the latest quarterly report pointed out that the second quarter global demand is expected to reach 7.4GW, compared with 77% growth rate in the same period last year.

In the first quarter of 2011, component manufacturers continued to expand their sales channels and recruit more small-scale distributors and intermediaries to digest increased production and maintain better factory prices. This may cause the number of downstream stocks in Europe to increase to an unsustainable level at the end of the quarter, and to a lesser degree in the United States.

By mid-2011, the top five markets in Europe will experience reductions in subsidy policies (FIT), some as high as 45%. Therefore, the demand for the second quarter will be an early retrenchment stimulated by the reduction in FIT during the year, especially in Germany and Italy. While other European markets, the United States, Canada, China and India have a steady growth.

In 2011, component manufacturers plan to increase shipments by 55%, but the annual market demand growth rate is expected to be only 12%. After the peak of demand in the second quarter, the industry will face a very challenging second half, especially the imbalance between supply and demand. In order to avoid excessive inventory, it is estimated that there will be a period of time that will require appropriate production cuts.

The catastrophe of nuclear power plants that occurred after the major earthquake and tsunami in Japan may lead to the adjustment of photovoltaic policies by various governments, but it will not impact the market demand before 2012. At the same time, Japan’s nine major factories engaged in silicon materials, silicon wafers and batteries are currently not affected by the earthquake. “Because the pace of market growth has slowed down, 2011 will be a challenging year for the industry,” said CraigStevens, general manager of Solarbuzz. “Europe is no longer the locomotive of growth in the past few years, and manufacturers will need to expand into new markets, otherwise When prices fall, they will bear the burden of stockpiling or sharply reduce production.

By the fourth quarter of 2011, manufacturers in mainland China, Taiwan, and non-European, American and Japanese countries will have 74% of the world's battery capacity, up from 66% in the fourth quarter of last year. The leading manufacturers of thin film manufacturing, First Solar, and low-cost Asian manufacturers will be relatively vulnerable to shipments in the second half of the year; however, all manufacturers are expected to face strong price pressures by the end of the year. Low-cost mainland and Taiwanese manufacturers will continue to benefit from the increasing number of outsourcing orders from Japan, Europe and the United States.