International quotes for photovoltaic (PV) silver conductive paste used in making solar cell modules have risen 20% from US$1,500-1,600/kg in January 2011 to US$1,900/kg currently. This is due to the increase of prices for silver from US$26/ounce in February 2011 to US$46/ounce currently, according to industry sources in Taiwan.

The increasing prices of silver have been adding pressure to solar cell manufacturers. Even if silver conductive paste firms are willing to cooperate with cell firms to lower their costs, they are also facing great pressure from the hiking silver prices.

In terms of conversion ratio, silver conductive paste performs better than other conductive pastes, and the majority of supply is still controlled by international firms such as Heraeus, Dupont and Ferro. Although Taiwan-based paste firm, Giga Solar, has been aggressively trying to expand it presence in the market, its market share is still limited.

Recently cell makers got a bit of breathing room as prices of wafers - which account for 80% of solar cells' production cost - decreased at the requests of cell makers. However, cell firms' output might drop further as Italy's incentive policies remain uncertain.

A multi-crystalline polysilicon solar cell
Photo: Terry Ku, Digitimes, May 2011