>>Yet as global demand for PV panels has slackened, GCL Chief Executive Officer Hunter Jiang says his predominantly Chinese clients want to renegotiate their long-term polysilicon contracts to mirror the declines in the spot market. In particular, China's SunTech is trying to rework its contracts with suppliers to help offset the slump in demand next year.
Jiang says he's willing to renegotiate supply contracts with customers for a lower price, providing they pay more at the back end of the contract so the overall value stays constant. "For 2009, due to the financial crisis, we have got to work together as long-term relationship partners," he says. "But the reason we haven't signed anything is because we still don't feel pricing has gone to the bottom."<<
My guess today's bump due to Euro rise. However, the above is the harsh reality of the solar market. Jiang is saying effectively, pay me now or pay me later...either way you're going to pay for polysilicon. So, so much for "renegoitated" contracts. Sideways with a slight return to mid 9s for tomorrow.
This guy will renegotiate and he has no choice for when this sakeout begins there will be many smaller players that this supplier did business with that will disappear.
STP being one of the companies that many believe will weather the storm and will eventually gain more market share by process of elmination and so this silicon supplier will have to go along with what STP feels is a fair rate. Remember that STP has made some major investments in the Russian silicon company Nitol and Hoku so they do have distinct advantages and will use their muscle to ensure those advantages.