Solar cell makers subject to contract price competition, say Taiwan makers
Nuying Huang, Taipei; Adam Hwang, DIGITIMES [Monday 19 January 2009]
In view of price-cut competition at the spot market, some international suppliers of solar modules have begun gathering quotes from their solar cell contract suppliers in Taiwan and China, and then picking the lowest quotes, effectively having their contract suppliers compete for shipments, according to industry sources in Taiwan.
Many supply contracts inked in 2008 do not specify exact prices, shipment volumes or times of delivery, allowing considerable room for negotiation between both sides depending on current market conditions, the sources pointed out. Due to the rapid shrink in global demand, many China-based solar cell makers and some Taiwan-based makers have been under pressure from high inventory levels and need cash, and have thus quoted relatively low spot market prices to compete for orders, the sources indicated.
If the market does not rebound at the end of the first quarter of 2009, which is traditionally a slow period, more cases of price-cut competition are expected among contract suppliers, the sources pointed out.
As the 2009 market outlook is uncertain and spot market prices are likely to drop further, the number of solar module suppliers willing to sign supply contracts has decreased significantly, the sources indicated. |
