The price of polysilicon last week reached its highest level since 2011 and, according to Chinese module manufacturer JinkoSolar, there are no visible signs that it could drop this year, as predicted by several analysts.

The global solar industry’s supply chain issues that have been triggered by the Covid-19 crisis may continue during 2022 and the expected price drop for polysilicon and solar products may not materialize.

This is, at least, the outlook of Chinese solar module manufacturer JinkoSolar, which in a statement to pv magazine said the polysilicon and international freight costs may stay elevated for a few years before normalizing again.

“The latest announced price of solar-grade polysilicon jumped 10% month-to-month on Tuesday, February 15, sitting at 249RMB/kg (39.3US$/kg), the highest since 2011,” the manufacturer stated. “It’s up more than 400% since the start of June 2020 and 280% YoY growth. It is opposite to most predictions that polysilicon costs will decline in 2022.”

According to the panel maker, polysilicon producers are currently recording very high margins, which make them reluctant to reduce prices. “The lasting shortage gives a renewal excuse for polysilicon makers to keep the price at a high level, and the pricing environment for solar modules is continuously nervous after China’s Spring Festival,” it further explained. “Strong demand and the effect on inflation jointly create a destructive mix in the solar industry.”

The company also claims that the current polysilicon shortage will push module manufacturers to reduce silicone consumption per wattage and seek to increase efficiency, in an effort to further reduce costs. “Adopting higher power and higher efficiency technology and products could be the only possible way for downstream project developers as well as cell/module producers to navigate the risk of logistics and raw material price fluctuation,” it emphasized, noting that efficiencies over 22% may become crucial to achieving economies of scale benefits and a reasonable LCOE in large scale projects.