Most China tier-1 solar PV module suppliers have sold out until the second quarter of 2015, according to IHS. Along with the consolidation of the PV module industry, China tier-1 suppliers increased their market share from 34% in the first quarter of 2014 to 45% in the fourth quarter. IHS forecasts these suppliers will maintain their combined market share in the first quarter of 2015. Representing 35% of global module capacity, the total effective capacity of China tier-1 module suppliers in the first quarter is expected to reach 5.7GW, while total global demand is expected to reach 10.8GW.
"We have heard from both suppliers and buyers about the expected shortage of China tier-1 modules in the first quarter," said Jessica Jin, analyst for solar at IHS. "After a demand surge in the fourth quarter of 2014, China tier-1 module suppliers decreased their inventory significantly. Considering the Lunar New Year occurs in the first quarter, companies won't run their capacity in full production, either; so they won't have enough products for all quotations. Most of them have already sold out for the first quarter."
As they are well positioned in the global market, China tier-1 module suppliers will benefit from demand surges in Japan, the UK, South America and Central America. Because some projects in China have been postponed and are not expected to be completed until the first quarter of 2015, the China domestic-market demand is also substantial.
IHS also said it forecasts total global solar PV installations will reach 52.8GW in 2015, although most installations will occur in the second half of the year. China tier-1 suppliers will again build up inventory, beginning in the second quarter of 2015, to prepare for the expected demand surge in the second half of 2015. Acquisition among makers, and expansion in the module industry, is expected to speed up, since the current capacity of China tier-1 suppliers cannot meet market demand.
JA Solar has announced a 20% increase in module capacity in China in 2015. Trina Solar will add 1GW of module capacity in 2015. More expansions are expected among China tier-1 module suppliers.
Overall global demand is expected to be unusually weak in the first quarter of 2015; however, the typical seasonal setback will be mitigated by strong demand in Japan, UK and other countries. The first quarter (January-March) is the last quarter of the financial year in Japan, where IHS forecasts a 12% quarterly increase. In the UK, the Renewable Obligations Certificates (ROC) scheme for ground-mount systems larger than 5MW will end at the end of the first quarter, so there has been a rush of installations in this market; IHS forecasts that 1.6GW will be installed there in the first quarter. A demand surge is also expected in Central and South America, including Brazil, Chile and Mexico, where a quarterly increase of 80% has been modeled, the firm said.