The solar industry is under duress to say the least, and the very real possibility China may end up creating the first solar bubble is now being bantered about in the media, with solar companies like LDK Solar (NYSE:LDK) China Sunergy (NASDAQ:CSUN) GT Solar International (SOLR), First Solar (Nasdaq:FSLR), Canadian Solar (NASDAQ:CSIQ) sure to come under stress after a seemingly unhindered run for several years before 2009.
Forbes' William Pentland wrote, "The epic expansion planned for the latter part of this decade may create the world’s first solar-energy bubble. The existing solar supply chain is likely too shallow to sustain growth on this scale. Unless the industry develops scalable infrastructure over the next four years, China’s planned installation of 8 GWs of solar capacity annually between 2015 and 2020 is likely to create severe bottlenecks in the solar supply chain. These bottlenecks could radically inflate the price of basic materials like silicon and create labor shortages that would affect the costs of manufacturing solar modules, designing and installing new solar systems and operating and maintaining already installed systems."
Combined with Germany and Italy cutting back on solar subsidies, it would make the China market even more important as far as solar goes, and with little demand from other countries, will disproportionately affect to view of the industry. during the coming years, which appear to be very negative.
First Solar closed Monday at $130.04, gaining $0.08, or 0.06 percent.
Tuesday, May 10, 2011
Solar Bubble (LDK) (CSUN) (SOLR) (FSLR) (CSIQ) Coming for These Firms?
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3 comments:
Love the bullishness. Keep trying to beat down the stock prices and Ill keep on profiting.
Another $91m order for GT solar today.
They are really being hit hard....with tons of orders.
$343m last week and now this...I better go sell before they crash.
China announced plans for 50GW until 2020, +150% in comparison with its previous plans.
The same did India.
Polysilicon spot prices are 50% higher than last year, at $75 per kg.
According to chinese media, China is facing a shortage in polysilicon, due to the increased demand.
Chinese polysilicon producer Daqo New Energy announced EPS of $0.90 for the first quarter from $0.20 last year. It's listed in US.
HK listed Chinese CGL Poly is in an uptrend for months now, reaching a P/E and a P/BV much higher than its US listed Chinese competitors.
LDK is the only left polysilicon producer at such low price. First quarter's results will show if market evaluates correctly this stock.
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