Europe is still the largest export market for photovoltaic modules.
What is the solution to the "hidden worries" of photovoltaic exports in the future?
Europe is still the largest export market for Chinese photovoltaic products. However, in the context of the localization of European photovoltaic manufacturing and support for the local photovoltaic industry chain, Chinese photovoltaic manufacturers "going overseas" are not without hidden worries.
In the first two months of 2023, China's export of photovoltaic modules showed a phenomenon of "not slow in the off-season".
According to the latest customs data, from January to February 2023, China's module exports reached 47.8 billion yuan, a year-on-year increase of 9%, ending the continuous month-on-month decline since August last year.
Europe is still the largest export market for Chinese photovoltaic products, and more than half of
photovoltaic modules are shipped to Europe.
According to customs data, from January to February 2023, the export value of photovoltaic modules in Europe will be 27 billion yuan, a year-on-year increase of 58%. Among them, the export data of Spain, France, Poland, Greece, Belgium, Denmark and other countries all achieved positive month-on-month growth from January to February. In contrast, the Asian region decreased by 36% year-on-year, and the Latin American region decreased by 6% year-on-year.
For a long time, the European market has been highly dependent on photovoltaic products imported from China. In 2022, the European market's high dependence on Chinese photovoltaic products will rise instead of falling. According to data from market information company Infolink Consulting, Chinese photovoltaic companies will export a total of 154.8GW of photovoltaic modules in 2022, an increase of 74% over 2021.
Among them, more than half of the photovoltaic modules are exported to the European market. In 2022, China will export 86.6GW of photovoltaic modules to Europe, an increase of 112% compared to the export volume in 2021 (40.9 GW).
China International Finance Securities believes that in the context of a high base, the export value of photovoltaics will still exceed expectations to achieve a year-on-year growth of 15% from January to February 2023, and the average monthly amount in the first two months will achieve the first month-on-month growth since August last year. (Monthly average increase of 22%), showing that overseas demand remains strong in the context of a significant drop in natural gas prices, and inventory is well digested.
However, under the background of the localization of photovoltaic manufacturing in Europe and the support of the local photovoltaic industry chain, Chinese photovoltaic manufacturers "going overseas" are not without hidden worries.
On March 16, as part of the Green Agreement industrial plan, the official website of the European Commission officially announced the two cornerstones of the green industrial plan, the "Net Zero Industry Act" and the "European Key Raw Materials Act". Indigenous production capacity of green industries increased to 40%.
The bad news that the European Union is pushing for the localization of photovoltaic manufacturing in Europe has also directly "detonated" the domestic photovoltaic industry, triggering a flash crash in the stock prices of many leading photovoltaic companies.
"The fundamental purpose of the EU's introduction of this policy is not to restrict China, but to benchmark the US Inflation Reduction Act (IRA). If the EU does not do this, the factories of their local companies, including manufacturing capacity, will 'run' to other countries. The country has become a country, so the fundamental purpose of the policy can be understood as keeping local manufacturing from being 'robbed'." A senior person in the photovoltaic industry said in an interview with the media recently.
Talking about the impact on Chinese photovoltaic enterprises, the above-mentioned senior photovoltaic industry insiders said that the impact of this bill on relevant Chinese photovoltaic enterprises is at least not as great as the market reaction, and it should not have a substantial impact on Chinese enterprises within two or three years. "Under the current circumstances, the EU needs to develop clean energy such as photovoltaic and wind power, and also needs Chinese photovoltaic products."
He believes that the "Net Zero Industry Act" is still in the draft stage and has not yet formed a clear legislation. It will take at least another year to complete the legislative process. During this period, the content of the bill still needs to be discussed within the EU. For example, France hopes to include nuclear power, while other EU countries believe that only photovoltaic and wind power are green power, so there are still disputes within the EU over the content of the bill. In addition, from the final implementation of the bill to the establishment of photovoltaic production capacity in the EU, I personally think it will take at least three years.
Although the proposal of the European Net Zero Industry Act has almost no substantial impact on domestic companies in the short to medium term, under the hidden worries of import restrictions, overseas deployment may be one of the feasible countermeasures for Chinese photovoltaic companies.
Li Dongsheng, chairman of TCL Zhonghuan, a leading photovoltaic silicon wafer company, once again suggested during this year's two sessions that Chinese companies must carry out an active global layout in order to maintain the comparative advantage of Chinese manufacturing in global competition.
"China's photovoltaic products account for more than 90% of the global output, so the globalization of the photovoltaic industry is necessary and inevitable. The global photovoltaic market demand is growing very fast, and many overseas countries have proposed local development plans for the photovoltaic industry. In this context, If Chinese photovoltaic companies do not actively expand their global business, opportunities may be snatched by other countries." Li Dongsheng said.
The aforementioned senior photovoltaic industry insider added, “For Chinese photovoltaic companies, they can choose to go to Europe to build factories. According to the situation of the US Inflation Reduction Act (IRA), (the United States) will not check the parent company’s registration place. Traceability investigation. That is to say, if the relevant companies have factories (capacity) in Europe or Southeast Asia, they can also circumvent the restriction in the "Net Zero Industry Act" that the products of a certain country should not exceed 65% of the European market share."
In the view of China Post Securities, the current scale of components imported from China in Europe accounts for about 90% of its total demand. In the long run, the 40% localized manufacturing target may have a greater impact on imports, which is expected to accelerate the overseas deployment of leading domestic photovoltaic companies.
Since the beginning of this year, many leading photovoltaic companies have "goed overseas" to build factories. In January, JA Solar announced an investment of US$60 million to build a module manufacturing plant with a maximum capacity of 2GW in Phoenix, USA. On March 13, LONGi Green Energy plans to cooperate with Invenergy, an American clean energy developer, to build a 5GW photovoltaic module factory in Ohio, USA. The factory is expected to start construction in April this year and be put into operation by the end of 2023.
Source: China Business News
