According to industry sources, some China-based solar wafer makers were quoting US$4.30-4.50 at last week's Solar Power trade show in the US, which is a 7% increase from US$4 currently. The China-based companies are signaling to the market that wafer prices will continue to trend up and now is the time to procure wafers at lower costs, the sources said.

Taiwan-based solar wafer maker Green Energy Technology (GET) indicated at a recent investors meeting that spot prices for solar wafers have reached US$3.80 in Taiwan channels and up to US$4 in China channels.

The rapid wafer price increase is driven by shortages of materials and production equipment. China-based solar wafer makers have reserved equipment from international equipment vendors, which has impacted capacity expansion in other regions. In addition, new capacities at solar cell makers are gradually going online, which has significantly increased wafer demand.

However, some solar wafer and cell companies believe the price increase is due to speculation, and fundamentals will soon take over as governments in Europe reduce subsidization. The impact will move from downstream back upstream.