In May 2026, the European Union adopted a series of restrictive measures against China in the new energy sector, several of which are directly related to the photovoltaic and energy storage supply chains. In this situation, how will the European's solar market goes...?

[Silicon Metal Prices Shift to Move Sideways, Attention on Operating Rate Changes on Both Supply and Demand Sides]: At the beginning of the week, spot silicon metal prices edged lower in a narrow range before shifting to move sideways. As of May 21, SMM east China oxygen-blown #553 silicon was at 9,100-9,200 yuan/mt, down 150 yuan/mt WoW, and #441 silicon was at 9,300-9,400 yuan/mt, down 150 yuan/mt WoW. The futures market center shifted lower WoW. On Thursday, the most-traded SI2609 contract closed at 8,440 yuan/mt, down 215 yuan/mt WoW, with open interest at 308,000 lots, a WoW decrease of 7,000 lots. In terms of market transactions, as futures weakened at the beginning of the week, some downstream buyers and traders increased their rigid demand purchases, and the market transaction center moved lower WoW. Fundamentals side, both supply and demand of silicon metal are expected to increase in June. Supply side, the main driver is the increase in operating rates of silicon enterprises in Sichuan and Yunnan during the rainy season. Demand side, the main factor is production resumption expectations of individual polysilicon enterprises.

GREW Solar is accelerating plans to build an 8GW solar ingot and wafer factory in Madhya Pradesh ahead of India’s ALMM List-III for wafers, which will take effect in June 2028. The facility, located in Narmadapuram, is targeted for commissioning by March 2028 and will be developed alongside GREW’s cell manufacturing capacity, which is planned to reach 8GW by the end of 2026. GREW currently operates 6.5GW of module capacity in Rajasthan and plans to expand it to 11GW.

[SMM Silicon-Based PV Morning Meeting Minutes: Polysilicon Prices Temporarily Stable, Module Prices Relatively Weak] Last week, China's module prices were basically stable, but amid this stability there was a tug-of-war between upstream and downstream. Currently, distributed and some centralized procurement plans are increasing, but for current module prices, negotiation and pushing for lower prices remain the main approach. However, on the module side, due to support from the cost side, especially silver prices, and strengthened support from solar cell prices, maintaining stable prices remains the priority. Currently, distributed Topcon 183, 210R, and 210N high-efficiency modules are quoted at 0.7445 Yuan/W, 0.752 Yuan/W, and 0.755 Yuan/W respectively, while centralized Topcon 182/183 and 210N high-efficiency modules are quoted at 0.7235 Yuan/W and 0.7435 Yuan/W respectively.

[Bulls Cut Open Interest, Silicon Metal Prices Weakened; Polysilicon Prices Remained Stable Overall]: Spot prices were mostly stable this week, with prices of certain silicon grades edging down slightly. As of May 14, SMM east China oxygen-blown #553 silicon was at 9,200-9,400 yuan/mt, down 50 yuan/mt WoW; #441 silicon was at 9,400-9,600 yuan/mt, flat WoW; #3303 silicon was at 10,100-10,300 yuan/mt, flat WoW. Futures market sentiment cooled. In terms of total open interest, it began to decline sharply from Tuesday as funds took profits and exited, causing futures prices to pull back. On Thursday (May 14), total open interest in silicon metal stood at 450,000 lots, down 85,000 lots or 16% from Monday. The most-traded SI2609 contract closed at 8,655 yuan/mt on Thursday, down 455 yuan/mt or 5% from Monday, as the silicon market returned to fundamentals-driven logic. Transaction side, downstream users showed strong wait-and-see sentiment amid the price fluctuations, with transactions mainly driven by rigid restocking demand.

The Alliance for American Solar Manufacturing and Trade has asked the US Department of Commerce to launch a nationwide anti-circumvention probe into solar imports from Ethiopia. AASMT alleges that Chinese-origin wafers are being processed into cells in Ethiopia and then assembled into modules in Ethiopia or Vietnam for export to the US, bypassing existing AD/CVD duties. The petition comes after US imports of Ethiopian solar products surged from zero in June 2025 to over USD 300 million by year-end, raising concerns that Ethiopia may become a new circumvention route amid tighter US scrutiny of solar supply chains.

[SMM Silicon-Based PV Morning Meeting Summary] Polysilicon: N-type recharging polysilicon was quoted at 34-36.1 yuan/kg. Polysilicon prices were relatively stable overall, with extremely limited order signing in the market. Some crystal pulling plants showed low-price purchase willingness, but top-tier manufacturers still held the floor above 35 yuan. With cost setting imminent, manufacturers had a strong wait-and-see sentiment. Wafer: Market 18X wafer prices were 0.9-0.93 yuan/piece, 210RN wafer prices were 1.00-1.03 yuan/piece, and 210N wafer prices were 1.2-1.23 yuan/piece. Recently, a top-tier enterprise completed bulk transactions of 210R wafers at 1.02 yuan/piece. Currently, except for 210N, the other two sizes had already accepted the previous round of price increases, and subsequent trends would depend on downstream cell price movements.

According to an SMM survey, a second-tier wafer enterprise has mortgaged its Inner Mongolia base to a domestic PV equipment manufacturer, involving approximately 45GW of annual wafer capacity. In addition, the enterprise currently retains approximately 28GW of annual wafer capacity at its Yunnan base. Recently, numerous reports have emerged about wafer enterprises planning to exit the market, with sources of varying reliability. Overall, the pace of market-driven capacity rationalization in the PV industry is accelerating.

SEG Solar is accelerating its vertical integration with a 5 GW ingot and wafer facility in Indonesia, with Phase II construction set for Q2 2026. Once operational, the site will complete an end-to-end manufacturing chain encompassing ingots, wafers, cells, and modules. Founded in 2021, the company has seen rapid growth, reporting cumulative global shipments of over 7.5 GW by the end of 2025. This integrated strategy is designed to provide a fully traceable, non-FEOC supply chain for the evolving global solar market.

As major global technology companies rush to buy memory chips, SK Hynix is being actively courted by these companies, which have proposed plans to invest in its new production lines and finance the purchase of expensive manufacturing equipment. According to six people familiar with the matter, the company's clients have presented multiple partnership proposals to the South Korean chipmaker, including investing in the construction of dedicated memory production lines. Three other people familiar with the matter said another proposal involves clients providing financing for equipment purchases, such as ASML's extreme ultraviolet lithography machines. These machines are used to etch circuits on wafers and are worth hundreds of millions of dollars. The chipmaker is reportedly cautious about accepting financial commitments from clients, as such deals could make it beholden to specific buyers and force it to supply chips at lower prices in exchange for longer-term, more stable revenue guarantees.