Solar cell firms have been stuck between a rock and a hard place due to weak demand of the end market. A fall in the quotes for solar wafers might relieve the pressure faced by cell makers for a short while. But for many solar cell firms with low capacity utilization, their plans of selling its stocked wafers to gain cash-flow to get through times of low demand may hit a snag, according to industry observers.

The current bleak condition of the solar market will be hard for solar cell prices to rebound anytime soon, industry sources stated. The fall in the price of wafers can benefit solar cell firms as it accounts for 70% of the total cost.

For solar cell firms with steady capacity utilization and clear order visibility, the price drop of wafers can prolong business.

On the other hand, for cell makers with high inventory of wafers and not enough orders, the price drop means it would be harder to dump the stocked wafers into the market in exchange for cash inflows.

According to industry sources, the demand in the solar market has been holding back for further price-downs.

Some solar cell makers may get breathing room from falling wafer price
Photo: Terry Ku, Digitimes, May 2011