The German House of Commons passed the latest motion on March 29, announcing that after implementing a one-time reduction of subsidies from April 1, the on-grid tariffs of photovoltaic power generation projects will begin to be reduced by 1% per month from May to the end of November. This means that the industry has been worried about Germany's substantial downward adjustment of PV project subsidies has finally come to a conclusion.

The market demand for photovoltaics in Germany accounts for more than half of the world's share. Subsidy cuts will inevitably lead to a sharp drop in this market demand. Under this background, many domestic first-line PV module manufacturers have increased their annual shipment plans. Many manufacturers are expected to accelerate the start of demand in emerging markets outside of Europe, but this process may take some time. Based on this, some analysts pointed out that the imbalance between supply and demand of PV products will continue to test the viability of many manufacturers.

Corporate profits harder to increase

At the end of last year, there was a surge of photovoltaic power stations in Europe, especially the German market, and the prices of related components and wafers also rose slightly. The industry expects this to be a signal for the PV market to pick up. However, it was not long afterwards. In 2012, the prices of photovoltaic products, including raw polysilicon and battery modules, continued to decrease.

This time Germany's PV subsidy has been drastically reduced. According to IMS Research, a market research organization, it will directly lead to the proportion of European installed capacity in the total installed capacity in the world to 50% this year from 69% last year. According to the German government’s expectations, the future will be annual. Photovoltaic installed capacity will be controlled within 3.5 GW, and the European market demand in the foreseeable future will continue to be sluggish.

From the perspective of the shipments of major PV product suppliers, Suntech Power, a leading manufacturer, expects this year's shipments to reach 2.5 GW, a 19% increase from 2.09 GW in 2011. Another giant Artes 3 On the 8th of the month, it was announced that shipments will increase by 51% to 2GW.

The rise in shipments is in contrast with the continuing downward demand. At present, the overall production capacity of the photovoltaic product market is excessive, and the imbalance between supply and demand is still outstanding. According to IMS Research estimates, from the point of view of the polysilicon market, the polysilicon production capacity exceeded 50% of the demand in 2011. With the expansion of production capacity in 2012 and 2013, supply and demand will further imbalance and reach 80%. IMS Research expects this year's global photovoltaic industry. The installed capacity will increase to 32.6 GW, an increase of 21%, but this increase has been reduced a lot compared to the past.

The imbalance between supply and demand means that for many photovoltaic companies, including leading companies, it means that the gross profit margin is further reduced. Suntech Power's gross profit margin in the fourth quarter of last year dropped from 17% a year ago to 9.9%. Jinkee Electronics recently announced that its gross profit margin in the fourth quarter of last year dropped from 29% a year ago to 4.4%. The biggest challenge at the moment is still how to make profits. Shi Zhengrong admits.

Demand or difficult to follow up

Product suppliers' substantial increase in production plans is mainly due to the good expectations for emerging markets, especially China's domestic market. Sunde Power's president Shi Zhengrong had previously predicted that China's total solar energy grid-connected capacity may double this year to 5GW.

However, according to many market analysts, demand in the emerging markets in the Asia-Pacific region has been spurring to fill the market gap left by the accelerated shrinkage of the European market in the short term. From the current perspective, Germany will remain the world's largest and most important photovoltaic market at least in 2012. According to market expectations, the proportion of installed capacity in global installed capacity in Germany may drop by 20%. If the global installed capacity reaches 33GW this year, the German market demand will drop by nearly 7GW. This capacity is not the same as the market capacity with smaller installed capacity in China and the United States. Filled in time.

Some domestic brokerage analysts also believe that in Europe and Other developed countries are expected to cut subsidies for photovoltaic industry, the industry continued to decline in the context of the background, the future development of photovoltaic focus will gradually tilt to the Asia-Pacific, but the short-term market and demand can not be completely switched. A group of noteworthy data shows that in February of this year, the export volume of China's PV modules increased by 0.7% month-on-month, affected by the German market rush, and the volume of exports to Europe increased by 32.8%. This shows that the dependence of domestic enterprises on the European market has not yet existed. Fundamental signs of loosening, this trend will continue to exist in the short term. The analyst said. â–¡ Our reporter Guo Lifang