Photovoltaic module shipments surge in the fourth quarter of 2012

A new PV module shipment record of 11 GW was reached in the fourth quarter.

01/15/2013


IHS After a disastrous third quarter of 2012 featuring extremely low factory utilization rates across the entire photovoltaic (PV) supply chain, a surge in demand was seen in the final quarter of the year for PV modules. A new PV module shipment record of 11 GW was reached in the fourth quarter according to the IHS Solar Integrated Market Tracker from information and analytics provider IHS. Despite this positive sign the situation of the global PV industry remains critical and a substantial recovery of the supply-demand balance is not expected to occur before the second half of 2013.

PV markets rebound sharply in the fourth quarter of 2012

The third quarter of 2012 dealt another blow to the global photovoltaic industry. After a relatively strong second quarter resulting in global installations of 7.8 GW, markets softened again. “Installations in the third quarter amounted to just 7.5 GW. Wholesalers, EPCs, and PV suppliers were forced to carefully control their inventory levels due to falling prices and low shipment levels and production cuts were the consequence,” commented Principal Analyst Stefan de Haan. In the third quarter of 2012, average module capacity utilization fell to 49 percent, cell capacity utilization to 56 percent, wafer capacity utilization to a record-low 55 percent, and polysilicon capacity utilization to 63 percent. In parallel, prices continued their slide in the third quarter of 2012 resulting in module industry revenues of only $6.0 billion—the lowest value since the second quarter of 2009. These difficult conditions were reflected in an increasing number of suppliers exiting the market.

“In the fourth quarter of 2012 global PV markets rebounded sharply. Very strong demand from Asia, with the surge driven largely by China and Japan, helped to compensate for sluggish demand in Europe. IHS estimates that global PV installations were 10.1 GW in the fourth quarter of 2012. In particular leading Chinese module suppliers benefited from the uptick in demand and shipped much more than previously expected,” explained de Haan. In total, 11.0 GW of global module shipments are estimated for the fourth quarter of 2012 - a new record for the industry. As anticipated by IHS, average market pricing for crystalline modules declined to $0.65 per watt at the end of 2012, down from $0.70 at the end of September. Importantly, however, the price decline lost momentum in the course of the fourth quarter. Towards the end of the year some module prices even increased. Record-level shipments paired with stabilizing prices drove a profound recovery of revenues. According to the IHS Solar Integrated Market Tracker, fourth quarter 2012 module revenues grew by a stunning 42 percent quarter-over-quarter, reaching $8.5 billion.

Suppliers will experience seasonal weakness in the first quarter of 2013

In the first quarter of 2013 suppliers are predicted to experience the usual seasonal weakness of global solar markets. Global PV installations are forecast to drop to 6.7 GW in this quarter. As a result upstream shipments and revenues will temporarily come under pressure again. With prices forecast to decrease by another 4 -5 percent in the first quarter of 2013 (compared to the fourth quarter of 2012), module revenues will fall back to the critical levels of the third quarter of 2012—or even below. This will force more suppliers to review their business models and eventually leave the solar market.

2013 will be the year of the turnaround

After a tough first quarter, a substantial increase in global demand is forecast to drive increasing revenues and stabilizing prices in the second half of 2013. IHS forecasts 35 GW of global installations in 2013, up 10 percent over 2012. Although this level of growth is lower than previous years, it will drive a continuous improvement of shipments and revenues in the polysilicon to module supply chain throughout 2013. Recent positive signals from authorities in several key markets like China and France raise hopes for the recovery of the PV industry to happen even faster. “Whilst it’s too early to give the all-clear for the PV supplier industry, there is increasing indication that the year 2013 will mark the turnaround,” concluded de Haan.

The chart below presents a forecast of global shipments of the photovoltaic module industry (crystalline and thin film).

Source: IHS January 2013



No comments
The Top Plant program honors outstanding manufacturing facilities in North America. View the 2013 Top Plant.
The Product of the Year program recognizes products newly released in the manufacturing industries.
The Leaders Under 40 program features outstanding young people who are making a difference in manufacturing. View the 2013 Leaders here.
The new control room: It's got all the bells and whistles - and alarms, too; Remote maintenance; Specifying VFDs
2014 forecast issue: To serve and to manufacture - Veterans will bring skill and discipline to the plant floor if we can find a way to get them there.
2013 Top Plant: Lincoln Electric Company, Cleveland, Ohio
Case Study Database

Case Study Database

Get more exposure for your case study by uploading it to the Plant Engineering case study database, where end-users can identify relevant solutions and explore what the experts are doing to effectively implement a variety of technology and productivity related projects.

These case studies provide examples of how knowledgeable solution providers have used technology, processes and people to create effective and successful implementations in real-world situations. Case studies can be completed by filling out a simple online form where you can outline the project title, abstract, and full story in 1500 words or less; upload photos, videos and a logo.

Click here to visit the Case Study Database and upload your case study.

Bring focus to PLC programming: 5 things to avoid in putting your system together; Managing the DCS upgrade; PLM upgrade: a step-by-step approach
Balancing the bagging triangle; PID tuning improves process efficiency; Standardizing control room HMIs
Commissioning electrical systems in mission critical facilities; Anticipating the Smart Grid; Mitigating arc flash hazards in medium-voltage switchgear; Comparing generator sizing software

Annual Salary Survey

Participate in the 2013 Salary Survey

In a year when manufacturing continued to lead the economic rebound, it makes sense that plant manager bonuses rebounded. Plant Engineering’s annual Salary Survey shows both wages and bonuses rose in 2012 after a retreat the year before.

Average salary across all job titles for plant floor management rose 3.5% to $95,446, and bonus compensation jumped to $15,162, a 4.2% increase from the 2010 level and double the 2011 total, which showed a sharp drop in bonus.

2012 Salary Survey Analysis

2012 Salary Survey Results

Maintenance and reliability tips and best practices from the maintenance and reliability coaches at Allied Reliability Group.
The One Voice for Manufacturing blog reports on federal public policy issues impacting the manufacturing sector. One Voice is a joint effort by the National Tooling and Machining...
The Society for Maintenance and Reliability Professionals an organization devoted...
Join this ongoing discussion of machine guarding topics, including solutions assessments, regulatory compliance, gap analysis...
IMS Research, recently acquired by IHS Inc., is a leading independent supplier of market research and consultancy to the global electronics industry.
Maintenance is not optional in manufacturing. It’s a profit center, driving productivity and uptime while reducing overall repair costs.
The Lachance on CMMS blog is about current maintenance topics. Blogger Paul Lachance is president and chief technology officer for Smartware Group.