Business
trend:
Japanese
material producers are in the process of shrinking the solar battery business greatly
due to the rapidly decreasing prices of Chinese products. Three Japanese
companies including JX Nippon Mining & Metals decided to dissolve their
joint venture in the silicon business and allocate extraordinary loss of about
13 billion yen. Chinese silicon producers participated in the Japanese domestic
market in 2010 with low-priced products. The market price of silicon is 15
dollars per ton, less than one tenth of the price in 2008. The joint venture
decided to withdraw from the business because it cannot work out solutions to
recover the profitability. Tokuyama will also record net loss of 41 billion yen
due to its stagnant silicon business in fiscal ending March 2013.
European Photovoltaic Industry Association reported that worldwide generation capacity
of photovoltaic generation increased 40% over the previous year to exceed 1,000,000
kW at the end of 2012. The increased generation capacity is about 30 million kW
that is equivalent to the generation capacity of 30 nuclear power plants. Worldwide
production capacity of silicon is expected to become 450,000 tons due to the participation
of Chinese producers, while demand for silicon remains at about 200,000 tons. As
if often the case, lots of companies rush into profitable products to decrease
the profitability drastically, and small- and medium-sized producers are wiped
out from the market. Do not pursue economy of scale to compete with inexpensive
products. Strenuous efforts to streamline production to reduce production cost
are not rewarded. The only solution to recover profitability in the market
dominated by inexpensive products is to increase the competitive edge and
launch products that can be sold at higher prices.
Worldwide
capacity of photovoltaic generation is increasing quite rapidly
