The price of photovoltaic glass is rising again! Obvious advantages in oligopoly market
According to PVInfoLink data, on October 7, the mainstream quotation of 3.2mm coating was 37 yuan/m2, an average price increase of 5.7% from last week, and the mainstream quotation of 2.0mm coating was 28 yuan/m2, which was the same as last week. Compared with ordinary glass, photovoltaic glass has higher quality requirements and limited new capacity, which is tight in the short term, and the rapid growth in demand has caused the price of photovoltaic glass to rise again.
The growth of the demand for photovoltaic glass is driven by the growth of global photovoltaic installations and the increase in the penetration rate of double glass modules. In the past ten years, the demand for photovoltaic glass has followed the growth of terminal demand, and the fluctuation of output value is less than that of modules.
From 2010 to 2019, photovoltaic installed capacity increased rapidly from 16GW to 115GW, CAGR=24.4%; the growth rate of demand for photovoltaic glass is basically the same as that of installed capacity, CAGR=22%, the reason for the slightly lower is the continuous improvement of the efficiency of battery modules; In terms of output value, photovoltaic glass reached 15.8 billion in 2019, CAGR=13%, and the volatility was significantly less than that of modules. The main reason is that the glass process is relatively mature and the cost price decline is smaller than the main industry chain.
The upstream of the photovoltaic industry chain is the collection of crystalline silicon raw materials and the processing and manufacturing of silicon rods, silicon ingots, and wafers. The middle of the industry chain is the manufacture of photovoltaic cells and photovoltaic cell components. At present, crystalline silicon cells are divided into monocrystalline silicon and polycrystalline silicon. The downstream of the industrial chain is the integration and operation of photovoltaic power plant systems.
Photovoltaic glass is the upstream raw material of photovoltaic modules. Its strength and light transmittance directly determine the life and power generation efficiency of photovoltaic modules. It is an essential material for the production of crystalline silicon photovoltaic modules.
Photovoltaic glass has special performance, complicated technical certification, high customer stickiness, long cycle and low cost. Therefore, once a photovoltaic cell glass company has established a purchase and sales relationship with a module manufacturer, it is generally relatively stable.
Photovoltaic glass can be divided into three main types, namely ultra-white patterned glass, ultra-white processed float glass, and transparent conductive oxide coated (TCO) glass. Due to the low iron content of ultra-white patterned glass and ultra-white processed float glass, compared with ordinary glass, ultra-white patterned glass has higher light transmittance to crystalline silicon photovoltaic cells, thereby increasing the power generation of photovoltaic modules effectiveness.
2.0mm and 2.5mm photovoltaic glass are in the early stage of their launch, and the cost is relatively high. Although 20-40% of the original glass is saved compared to 3.2mm glass, the price difference with 3.2mm glass does not reflect its due cost advantage. With the double glass trend driving the growth of demand for thin glass, the technological transformation and technological progress of large glass factories and large production lines, the price of thin glass has gradually decreased.
At present, the scale effect of photovoltaic glass is beginning to appear, and it is difficult for small companies to compete with large companies in terms of product quality, supply stability, and price. Therefore, the industry's oligopoly market has obvious competitive advantages.
Photovoltaic glass is a dual-intensive industry of technology and capital. The industry barriers constructed by first-mover advantage, scale advantage, resource advantage and customer advantage are prominent, and there have been no new entrants for many years.
From the perspective of market competition, the top 3 companies in my country's photovoltaic glass market share in 2019 are: Xinyi Solar (38%), Flat (24%), Rainbow Group (10%), and CR3 reaches 72%.
Xinyi Solar and Flatiron are the world's largest and second largest photovoltaic glass producers, respectively, with excellent gross profit margins, which are much higher than other companies in the industry. Currently, a duopoly has formed.
According to China Industry Information Network, the new production capacity in 2020 will only include Flat Vietnam first-line 1,000 tons/day, Flat Vietnam second-tier 1,000 tons/day, Xinyi Guangxi first-line 1,000 tons/day, Xinyi Guangxi second-line 1,000 Tons/day production line, Xinyi Solar Wuhu Xinyi 2 production lines 1000 tons/day.
Taking into account the ramp-up time of new photovoltaic glass production lines, it is expected that Xinyi Solar and Flatt will account for 38% and 24% of the market respectively in 2020.
New production capacity of photovoltaic glass requires a large investment. Therefore, the industry leader's leading advantage in production capacity will remain for a long time.
Based on the production capacity of the original photovoltaic glass, the market concentration of the top five photovoltaic glass manufacturers in the country increased from 63.3% in 2013 to about 80% at the end of 2019. The new production capacity in 2020 and beyond will also mainly come from leading companies, and it is expected that market share will be further concentrated in the large-scale photovoltaic glass leading industry.
In the photovoltaic glass sector, the expansion period is 18-24 months, and there is no new capacity investment in the short term. The supply and demand of photovoltaic glass will be balanced in 2020Q3, and the supply and demand will be obviously tight in Q4. The photovoltaic glass sector is also expected to start a new round of price increase cycle.
Affected by the epidemic situation at home and abroad, BloomberNEF newly expects to add 110GW of PV installed capacity globally in 2020. The lagging demand affected by the epidemic will be delayed. It is expected that 140GW of new installed capacity will be added in 2021, a year-on-year increase of 27%.
In 2020, driven by the uncompleted 2019 bidding projects and UHV projects, coupled with new bidding projects and low-cost projects, CPIA expects that in 2020, domestic PV installations are expected to increase by 35-45GW. Driven by the continued high prosperity of the photovoltaic industry, photovoltaic glass is expected to usher in sustained high growth.
