In the futures market on June 25, 2026, the main polysilicon contract (ps_ZL) on the Guangzhou Futures Exchange continued its decline from the previous day's high, with significant selling pressure intensifying during the session. It ultimately closed at 35,635 yuan per ton, down 670 yuan or 1.85% from the previous settlement price of 36,305 yuan per ton. Market sentiment was notably cautious, with the day's trading volume holding at 113,300 lots. However, open interest plummeted sharply to 38,335 lots. This substantial reduction of approximately 38,300 lots indicates that speculative long positions entered during the earlier price rebound are now exiting in a panic to cut losses, with concentrated short-selling dominating the day's weak performance.
According to data from the Changjiang Nonferrous Metals Network on June 25, 2026, the domestic polysilicon market exhibited a rare "four consecutive freezes": the average price for standard polysilicon was 32,500 yuan/ton (range 31,500-33,500), for recycled material 33,000 yuan/ton (32,000-34,000), for cauliflower material 29,750 yuan/ton (28,500-31,000), and for dense material 32,000 yuan/ton (31,000-33,000).
Supply-Side Deadlock Forms the Foundation of the Stalemate
The current low-cost hydropower during the Southwest's wet season keeps production costs in a low range. Leading integrated production capacity in Southwest bases is operating near full utilization, and monthly industry output remains elevated. This, combined with a massive "inventory dam" composed of factory stockpiles, spot orders from traders, and raw material reserves at silicon wafer plants, means any attempt to raise prices is thwarted by a "sell-first" preemptive logic. Conversely, price drops hit the cash cost line of high-cost capacity, making sellers unwilling to concede further, leaving quotations stuck near cost levels. The issue is not a lack of production but a tangle of three states: those who can produce face no sales worries, those who cannot afford to produce cannot sell, and those trying to hold out cannot sustain it. This combination naturally freezes prices.
Demand-Side Stagnation is the Core Driver of the Stalemate
Polysilicon consumption is entirely tied to downstream silicon wafer, cell, and module segments. The entire photovoltaic chain is currently in a dark phase characterized by low module prices, reduced silicon wafer operating rates, and high inventory at the cell level. Downstream procurement is locked into an extreme defensive mode of "minimum safety stock + daily rolling." Even with polysilicon prices at the cash cost line for some producers, wafer plants are reluctant to buy more because unsold modules mean additional polysilicon purchases would only turn into inventory write-downs. More critically, following the implementation of policies eliminating export tax rebates, the previous rush-to-export advantage has vanished. Limited growth in overseas orders has further amplified domestic absorption pressure. The virtuous cycle of "inventory reduction and production scheduling" for the entire industrial chain is completely broken. Without transactions, prices naturally cannot move.
Policy Outlines a "Long-Term Survival Line" but Cannot Move Short-Term Inventory
Tighter energy consumption limits and stricter industry standards for photovoltaics aim to phase out non-compliant capacity, raise clearance thresholds, and pave advantages for leading players in the long run. However, implementation is slow. Recent local-level "anti-internal competition" guidelines remain principle-based constraints without verifiable capacity reduction actions yet. While they may prevent disorderly collapse, they cannot help digest the massive spot inventory. Measures within the anti-internal competition policy, such as halting new capacity approvals and enforcing price/energy efficiency standards, also draw a "must meet standards to survive" line. However, the short-term elimination of export rebates has reduced the pressure relief valve for the external cycle, increasing domestic absorption pressure. Thus, policy has drawn a "bottom" for polysilicon, but the inventory reduction needed for a price rebound must be ground out by time itself.
Macro Factors Further Lock in Polysilicon's Volatility Range
On the day, the domestic nonferrous metals sector faced overall pressure, with major products like copper and aluminum recording significant declines. The downshift in risk appetite across the broader commodities complex further dampened sentiment in the photovoltaic supply chain. Even with polysilicon's own supply-demand dynamics frozen, it could not escape the drag of the broader macro market, failing to stage an independent rally. The current polysilicon price formula has reverted to its simplest form: Profit = Selling Price - (Electricity + Silicon Powder + Labor + Depreciation + Finance Costs). For most companies, the current selling price still results in negative cash flow. In this environment, futures can lift the forward curve on policy rumors, but spot prices must obey inventory reduction rhythms and pressure. Once rumors fade, spot prices obediently return to hovering near the cost line.
Interpreting the Prolonged Stalemate
In summary, consecutive days of zero price movement across the board should not be read as "stability" but as a deepening freeze near the cost line. The supply side is too unprofitable to cut prices further, the demand side is too frugal to allow price increases, policy has drawn a long-term survival line but offers no short-term inventory relief, and macro factors have added downward pressure. The only two keys to breaking the deadlock are either verifiable weekly reductions in factory inventory for several consecutive weeks, or cash flow permanently shutting down more capacity. Until then, the zeros on the price list represent the most silent yet piercing sound in the polysilicon industry, more telling than any price movement: the industry has not collapsed, but it is not recovering either. It is merely holding on at the cost line, waiting either for inventory to be consumed or for capacity to be cleared out.
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