Daqo Lowers Polysilicon Sales Forecast For Q3/2020

Higher Average Selling Price For Polysilicon Forces Daqo New Energy To Lower Sales Guidance For Q3/2020; Annual Production Guidance Increased For 2020
11:29 PM (Beijing Time) - 16. October 2020
Presentation2

Daqo New Energy lowered its polysilicon sales guidance for Q3/2020 while increasing production for the quarter due to higher ASPs. With sales improving since October, it has increased its annual production guidance for 2020 to 75,000 MT to 76,000 MT.

Key Takeaways

  • Daqo New Energy has revised its Q3/2020 polysilicon sales guidance lowering it from the previously provided guidance
  • Increase in ASP during Q3/2020 has pushed back some of its orders hence the change in guidance
  • It has increased production guidance for 2020 since the company has been seeing orders and product deliveries resuming to normal levels since October 2020

Chinese polysilicon producer Daqo New Energy has pulled down its guidance for polysilicon sales in the 3rd quarter of 2020 due to some of the company’s orders getting pushed back due to ‘dramatic rise’ in its average selling prices (ASP) for polysilicon.

From $7.0 to $7.5 per kg ASP for polysilicon in Q2/2020, these have increased to around $11.5 to $12.5 per kg, according to Daqo forcing it to revise its sales guidance for Q3/2020. During the latter quarter, it expects the ASP to be close to $9.13 per kg.

It now expects to have sold 13,643 metric ton (MT) during Q3/2020, as against the previous guidance of between 17,000 MT to 17,500 MT (see Daqo Sold More Polysilicon Than Guided In Q2/2020).

Nonetheless, it managed to exceed its polysilicon production guidance for the quarter to produce around 18,406 MT as against the guided 17,500 MT to 18,000 MT for an average total production cost of $5.82 per kg and cash cost of $4.88 per kg.

“However, entering into October, the Company is seeing orders and product deliveries resuming to normal levels. We expect the inventory built up temporarily in September will be sold in the 4th quarter, as we expect to see strong end-market demand both domestically and abroad,” said Daqo management.

As a result, the management has upped its annual polysilicon production guidance for 2020 to now within the range of 75,000 MT to 76,000 MT, compared to its previous guidance of 73,000 MT to 75,000 MT.

Anu Bhambhani

Anu Bhambhani is the Senior News Editor of TaiyangNews

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Anu Bhambhani