Taiwan-based solar module makers could post losses in the second quarter due to solar cell shortage-induced price hikes and exchange rate volatility, according to industry sources.

Taiwan's solar module makers, smaller in production volume compared with their counterparts in other regions, have less leverage during price negotiation for solar cell procurement. While price quotation for Taiwan-made modules rose in recent months to reflect climbing cell costs, prices of modules produced by larger manufactures have remained fairly stable, sources said.

Furthermore, with the current financial crisis in the Europe, most Taiwan-based module makers are taking losses in currency exchange rates as well, sources added.

Despite favorable development on the demand side including Japan reinstating subsidies for the solar industry and Germany's feed-in-tariff rate cut on July 1, which should intensify installation, Taiwan-based module makers could still post losses for the second quarter.