---
title: "Emotional Nuclear Explosion in the Silicon Material Predicament: From Halving to Limit Up for Polysilicon Under Anti-Competition"
type: "News"
locale: "en"
url: "https://longbridge.com/en/news/282799985.md"
description: "On April 13th, polysilicon futures hit the daily limit for the first time at the Guangzhou Futures Exchange, closing at 34,770 yuan/ton, an increase of 9%. This rise was attributed to rumors that photovoltaic companies would control production and set price floors, although several companies later refuted these claims. The A-share photovoltaic sector subsequently surged, with Daqo Energy rising over 12% at one point. Polysilicon futures prices have been on a downward trend this year, with the lowest price on April 10th dropping nearly 48% from the highest price at the beginning of the year"
datetime: "2026-04-15T06:56:09.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/282799985.md)
  - [en](https://longbridge.com/en/news/282799985.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/282799985.md)
---

# Emotional Nuclear Explosion in the Silicon Material Predicament: From Halving to Limit Up for Polysilicon Under Anti-Competition

On the afternoon of April 13, 2026, the main contract 2605 for polysilicon at the Guangzhou Futures Exchange surged straight up to hit the daily limit, closing at 34,770 yuan/ton, an increase of 9%, with trading volume exceeding 60,000 lots. The A-share photovoltaic sector also resonated with a significant rise, with Daqo Energy once soaring over 12%, and Tongwei Co., Ltd. experiencing a substantial increase.

However, this "limit-up feast" was not triggered by an improvement in fundamentals, but rather by an unverified "small article"—rumors suggested that several leading photovoltaic companies held a closed-door meeting in Chengdu in early April to discuss mandatory production control, setting a "floor price" for silicon materials, and establishing a default penalty mechanism. After the market closed, GCL-Poly Energy, TCL Zhonghuan, Longi Green Energy, and other companies successively refuted the rumors, which were proven false.

## **A Rumor Triggering Stock and Futures Linkage**

On the afternoon of April 13, the main contract for polysilicon futures suddenly surged in volume, ultimately closing at the 9% limit, with the price fixed at 34,770 yuan/ton. On that day, multiple contracts hit the limit simultaneously, exhibiting typical characteristics of "news-driven + short squeeze." The main contract's open interest reached 33,169 lots, with a trading volume of 59,236 lots, significantly increasing the trading value. On the morning of the 14th, polysilicon continued its upward trend, rising over 6% in the morning session, and later retracing to close up 0.61%, with trading volume increasing to 110,000 lots.

**This was the first limit-up for polysilicon futures this year.** Since the beginning of the year, polysilicon futures prices have been on a downward trend, with last Friday's lowest price down 48.39% from the highest price at the beginning of the year, nearly halving. The main contract fell 18.61% in January, 1.37% in February, 24.29% in March, and 8.74% in April (as of the close on April 10), with the lowest price on April 10 at 31,070 yuan/ton, nearly halving from last December's 61,985 yuan/ton.

With the significant rise on April 13, A-share photovoltaic concept stocks responded accordingly, with Daqo Energy surging 12.16% at one point, ultimately closing with a gain of 7.93%; Tongwei Co., Ltd., Hongyuan Green Energy, and others also saw substantial increases, with the total market value of the sector soaring by over 10 billion yuan in a single day.

On the morning of April 13, a rumor about "anti-involution" in polysilicon circulated in the market, mentioning that polysilicon would reduce production and raise prices to 50,000 yuan/ton, and that several leading photovoltaic companies held a closed-door meeting in Chengdu in early April to discuss mandatory production control and price support. This rumor quickly spread, stimulating a sharp rebound in the futures market.

After the market closed, Futures Daily sought verification from several related companies and learned that the aforementioned meeting minutes were false news. Regarding claims that there would still be related meetings this week or at the end of the month, several companies stated they had not yet received notifications for such meetings, and the authenticity of the related information remains to be verified. GCL-Poly Energy, TCL Zhonghuan, and others clearly responded that the news was untrue, while Longi Green Energy stated that the company is downstream in the supply chain and is unaware of the related meetings Industry insiders remind that market participants should rationally discern information that has not been officially confirmed.

## **Not Just Rumors**

The direct driving factor for the surge in polysilicon prices is the market rumor regarding production control and price protection, as well as profit recovery. GF Futures stated that the rise in polysilicon futures prices is mainly influenced by news of production cuts and price controls. Although this news has not been confirmed, some companies do have plans for maintenance and production cuts based on their strategic decisions and the impact of low prices.

New Lake Futures pointed out that the rise in polysilicon futures is primarily driven by news disturbances and cost support. **On one hand, as the opening market approached historical lows, some short sellers took profits; on the other hand, there were industry conference-related news leaks involving topics related to joint self-discipline against involution in early April.**

Guosen Futures believes that the rebound in polysilicon futures prices reflects a repair of market sentiment. "After consecutive declines, the market's pessimistic sentiment has been fully released, coupled with the uplifting effect of 'anti-involution' news, leading to price stabilization and recovery."

From a funding perspective, some market participants pointed out that when the industry is extremely pessimistic, any news of production cuts could ignite market sentiment and strengthen expectations for bottom-supporting policies. Previous short sellers had made substantial profits, and long positions had been accumulating for a long time; the stimulation from news became the last straw that broke the confidence of short positions.

Even setting aside the rumor factor, polysilicon prices have already entered a cost support area. Previously, some listed companies disclosed polysilicon cost data, such as Daqo Energy announcing that the unit cash cost of polysilicon is 33.95 yuan/kg, while last week the main contract price of polysilicon fell to a minimum of 31,070 yuan/ton (i.e., 31.07 yuan/kg), which has fallen below this cost line, somewhat reversing the trend of continued decline in polysilicon futures.

Due to an oversupply in the market, polysilicon futures prices previously fell below 31,000 yuan/ton, approaching the cash cost line of leading companies like Tongwei Co., Ltd. and GCL-Poly Energy Holdings Limited at 27,000-30,000 yuan/ton, with the industry's loss margin continuing to expand, prompting some short funds to choose to take profits and exit.

In addition, the main contract for polysilicon previously had a discount of over 2,000 yuan/ton compared to spot prices, leading to increased purchasing enthusiasm from some downstream companies, which may involve hedging long positions. The continuous approach of polysilicon prices to the cost line further stimulated the hedging demand from downstream companies.

From the supply side, the current polysilicon supply is showing a marginal contraction trend. In late April, multiple companies plan to conduct maintenance and production cuts, leading to a month-on-month adjustment in industry output, slightly alleviating supply pressure, combined with the downstream silicon wafer segment's need for inventory replenishment, and traders purchasing at low prices, pushing the futures market to stop falling and rebound.

According to data from GF Futures, the weekly polysilicon production stabilized at 19,300 tons. Previously, there were reports that multiple companies expected maintenance and production cuts in April, which could affect around 10,000 tons of output, but the expected reduction in production time is in the latter part of the month, so April's output is not expected to decline significantly. With the arrival of the flood season, there is currently an expectation of continued delays in southwestern capacity, but there is still a possibility of resuming operations. The current price is expected to have low resumption enthusiasm, and some companies may further reduce production.

Domestic demand remains unoptimistic, with downstream output decreasing month-on-month. Silicon wafer output in April slightly decreased to 48.73GW, battery cell output in April slightly declined to 44.3GW, and module output in April fell back to 32.15GW, with overall downstream output showing an inverted pyramid shape However, overseas demand is steadily increasing, and the FOB price of components exported to Chinese ports has slightly risen by 1.7-2.5%.

The Silicon Industry Association predicts that, in the context of declining costs and insufficient demand support, the silicon wafer market is expected to maintain a weak operation in the short term. However, after a recent continuous decline, the space for further price drops in silicon wafers is relatively limited. If demand improves subsequently, the silicon wafer market is expected to stabilize.

## **Structural Contradictions in an Imbalanced Landscape**

The core contradiction in the current market remains the supply-demand imbalance. According to data from the China Nonferrous Metals Industry Association Silicon Industry Branch, from April 2 to April 8, the average transaction price of N-type polysilicon re-investment materials was 36,000 yuan/ton, a decrease of 1.37% month-on-month; the average transaction price of N-type granular silicon was 35,000 yuan/ton, a decrease of 4.11% month-on-month.

In this regard, the Silicon Industry Association believes that, with the reduction in production by polysilicon enterprises in February lowering the industry operating rate to 35.5%, industry inventory continues to accumulate, indicating that the strength of supply contraction is still insufficient to offset the speed of demand shrinkage. The research report from Nanhua Futures also points out that the current fundamentals of the polysilicon industry exhibit characteristics of "weak supply and weak demand." On the supply side, the polysilicon market is under dual pressure from inventory and subsequent large manufacturers' operations, with manufacturers having a strong desire to offload, even leading to prices below cash cost lines; on the demand side, the operating rates of downstream silicon wafers, battery cells, and components are not high.

From the inventory perspective, according to SMM statistics, the latest inventory of polysilicon manufacturers is 335,000 tons, an increase of 1.50% month-on-month, and silicon wafer inventory is 27.45 GW, an increase of 1.48% month-on-month. Data from GF Futures also shows a slight weekly increase in inventory of 5,000 tons to 335,000 tons, with warehouse receipts increasing by 390 contracts to 11,970 contracts.

From a longer-term trend perspective, since 2026, China's polysilicon inventory has continued to increase: at the beginning of January, inventory was about 302,000 tons, increasing to 341,000 tons at the beginning of February, and slightly increasing to 348,000 tons at the beginning of March. In March, domestic polysilicon production was 92,600 tons, a slight increase of 9.7% month-on-month, further increasing inventory pressure.

On the demand side, the accelerated decline in market prices has intensified the downstream "buy high, not buy low" wait-and-see mentality. According to SMM statistics, N-type materials are priced at 34.00-36.50 yuan/kg, and N-type granular silicon at 34.00-36.00 yuan/kg, with spot prices remaining stable. However, the overall market trading atmosphere is still light, with downstream acceptance of high-priced sources not high, only meeting essential restocking needs.

The decline in polysilicon spot prices is related to excessive industry inventory, with downstream photovoltaic installations declining year-on-year and component production schedules being weak. The cancellation of export tax rebates on April 1 further affected expectations for overseas demand.

## **Capacity Cycle, Cash Flow Pressure, and Export Tax Rebate Impact**

By the end of the first quarter, polysilicon prices had fallen below the costs of leading enterprises, resulting in widespread losses in the industry. The sharp decline in polysilicon this year is primarily due to oversupply and high inventory levels. Additionally, while other segments of the photovoltaic industry are struggling near the breakeven line, the polysilicon segment, due to last year's price surge, had higher profits, but this also led to a larger space for price declines Some research suggests that the State Administration for Market Regulation's discussions with the Photovoltaic Association and major companies in early January 2026, along with the announcement of monopoly risks, changed the operating pattern of polysilicon. After this discussion, there was a differentiation within the polysilicon alliance, with some companies engaging in large-scale low-price shipments, leading the industry back to fundamental logic; although spot prices fell to around 35 yuan/kg, buyers continued to test the price bottom line, exerting downward pressure on prices. Market data also shows that polysilicon futures began this round of sharp decline from January 7.

The industry generally expects that polysilicon prices are still in the bottom-testing phase, and the industry needs to go through a difficult "bottoming period." The first sign is that the industry's operating rate continues to run at a low level, having dropped to 35.5% in February, with no recovery momentum in the short term. The second sign is that cash flow pressure has become the core variable for industry clearing, with some companies starting to reduce production passively through maintenance and shutdowns. The third sign is that the appearance of an inventory inflection point is a leading signal for prices to truly bottom out, and this signal has not yet appeared.

Experts from the China Photovoltaic Industry Association believe that in the second quarter, further production limits and inventory reduction are expected to push prices back to a reasonable range. The industry's load is already at a low level, but end demand is recovering slowly, and inventory digestion will take time, necessitating a continued reduction in load, especially for leading companies with a high capacity ratio.

The value-added tax export rebate policy for photovoltaic products was officially canceled on April 1, causing a significant impact on the demand side of the industry. The weakening demand in overseas markets has led to a gradual decline in the operating rates of photovoltaic module companies, which is gradually being transmitted upstream. GCL-Poly Energy's performance briefing indicated that **the first quarter is the off-season for the photovoltaic industry, and the impact of export tax rebates and related policies is the main reason for the recent decline in silicon material prices.**

The operating rates in the downstream silicon wafer, battery cell, and module segments are not high, and the overall upstream and downstream still mainly focus on consuming inventory, with pessimistic market sentiment spreading.

On April 1, the Guangxi Futures Exchange issued a notice to optimize the rules for polysilicon futures, adjusting trading thresholds, handling fees, margins, etc., which officially took effect on April 3, significantly releasing liquidity in the polysilicon futures market.

From a policy perspective, in recent years, the "anti-involution" policy orientation for the downstream photovoltaic industry has become increasingly clear. As early as November 2024, the Ministry of Industry and Information Technology revised the "Regulatory Conditions for the Photovoltaic Manufacturing Industry" and the "Interim Measures for the Management of Announcements in the Photovoltaic Manufacturing Industry." In December 2025, the long-awaited "Polysilicon Capacity Integration and Acquisition Platform" in the photovoltaic industry was established. In April of this year, the Ministry of Industry and Information Technology held a meeting emphasizing the need to resolutely break the "involutionary" competition in the photovoltaic industry and enhance the resilience and safety levels of key industrial chain supply chains. This policy background provides a "reasonable" imaginative space for market rumors.

## **Impact on the Industry Chain**

The limit-up market yesterday was essentially driven by rumors rather than fundamental improvements, but it reflected the market's strong expectations for a "turnaround" in the silicon material segment. Although leading manufacturers benefited from the rise in stock prices, the trading atmosphere in the spot market has not fundamentally changed.

From the perspective of corporate costs, Daqo Energy announced that the unit cash cost of polysilicon is 33.95 yuan/kg, while futures prices once fell below 31 yuan/kg, entering a deep loss zone The expectation of rising prices for polysilicon will directly increase the raw material costs in the wafer segment. Currently, the wafer segment is under pressure with low profitability and a persistently low operating rate, and the increase in upstream costs will exacerbate its operational pressure. According to SMM data, the domestic price of N-type 18Xmm wafers is CNY 0.94 per piece, and the price of N-type 210mm wafers is CNY 1.23 per piece, with prices continuing to operate at low levels. The wafer production is 10.82GW, a month-on-month decrease of 1.55%.

The profit margins in the downstream segment are further squeezed. In terms of battery cells, the price of high-efficiency PERC182 battery cells is CNY 0.27/W, and the price of Topcon M10 battery cells is CNY 0.35/W. In terms of modules, the mainstream transaction price for N-type 182mm is CNY 0.74-0.76/W, and for N-type 210mm, it is CNY 0.75-0.78/W, with prices all at low levels.

The comprehensive price index of the photovoltaic industry shows that as of April 7, the SPI (polysilicon) has dropped by 32.74% this year, the SPI (wafer) has dropped by 19.82%, but the SPI (battery cell) has increased by 3.05%, and the SPI (module) has increased by 7.73%, showing a clear differentiation pattern between upstream and downstream.

## **Conclusion**

In the short term, as sentiment retreats, it will return to fundamentals. Huatai Futures predicts that polysilicon prices are expected to continue to fluctuate weakly, with industrial silicon prices remaining weak, leading to weak cost support for polysilicon, compounded by high inventory levels, making it difficult for demand to be transmitted through the supply chain.

In the medium term, the four key factors are the rhythm of production reduction and capacity clearance, the pace of hidden inventory destocking, whether there are substantial actions on the policy front, and the subsequent impact of the cancellation of export tax rebates.

In the long to medium term, energy security and the growth in electricity demand driven by AI development are expected to boost the demand for polysilicon. Institutions estimate that global new photovoltaic installations are expected to reach 500-667GW by 2026, with domestic new photovoltaic installations expected to be 180-240GW. As demand rises in emerging markets such as India, the Middle East, and North Africa, global photovoltaic installations are expected to return to a stable upward channel during the 14th Five-Year Plan period, with an average annual new installation expected to reach 725-870GW. However, the aforementioned medium to long-term factors are unlikely to release significant incremental demand in the short term.

**References**

\[1\] Polysilicon spot price and inventory data, Shanghai Nonferrous Metals Network

\[2\] China Nonferrous Metals Industry Association Silicon Branch: Weekly Market Report on Polysilicon

\[3\] Polysilicon Daily: Limited price rebound space expected under high inventory, Huatai Futures

\[4\] Polysilicon: Production cuts and price increase expectations drive polysilicon futures to limit up, GF Futures

\[5\] Multiple contracts limit up! A "message" ignites the polysilicon market, Futures Daily

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