Polysilicon maker Daqo New Energy Corp. (DQ.US; 688303.SH) has become a hotbed of mixed signals these days, though a majority of those in the company’s latest quarterly report were decidedly negative. The company and its peers, whose products are a primary component of solar panels, are stuck in a storm of oversupply after building up massive new capacity over the last two years, causing prices to plunge amid tepid demand.
Daqo’s latest report did contain some slightly positive signals, however, as company officials said plunging prices may have finally stabilized, at least for now. They also discussed growing signs that Beijing may soon step in by offering policy support to soak up excess supply through the continued massive buildup of new solar farms.
In that regard, Deputy CEO Anita Zhu said on Daqo’s conference call that China is expected to add 250 GW to 300 GW of solar capacity this year, roughly similar to the 277 GW it added last year. Even without any growth, that would equal roughly half of global new solar installations that Zhu said are expected at 550 GW to 600 GW.