The powerful 7.9-magnitude earthquake struck central Myanmar on March 28, causing significant tremors in China’s Yunnan province that borders the southeastern Asian country.
Production Side: Wafer Output Suffers, Short-Term Supply Squeeze Begins
• The quake has had a major impact on the western regions of China, which are primary wafer-producing region. In the entire Yunnan province and Yibin prefecture of Sichuan province, the damage has been more severe, with reports of equipment failures such as furnace shutdowns and explosions, which could impact production over a longer period.
• Yunnan accounts for about 50% of China’s total wafer production capacity. The production halt has directly impacted global supply.
• Major wafer companies have suspended production due to equipment failures. The repair period may take several weeks or even months.
Indirect Impact on Regions like Inner Mongolia and Ningxia
• Some areas in Yinchuan and Inner Mongolia experienced decreased production due to power line failure and logistics disruptions, which are expected to be recovered in at least one week.
Logistics and Infrastructure disruption: Cross-Border Transport Disrupted, China-Myanmar Land Route Interrupted, Domestic Logistic Efficiency Declines
• The collapse of the Ava Bridge between Mandalay and the China-Myanmar border has affected the transportation of PV raw materials (such as silver paste and glass) and equipment.
• PV modules from Anji, Zhejiang to Myanmar now need to be rerouted through alternative ports, increasing transport costs by approximately 15%.
• Partial damage to roads in Yunnan and Sichuan has extended inter-provincial transport times by 20%–30%.
Price Hikes Due to Deteriorated Wafer Shortage
• Before the earthquake, the peak season for PV installations triggered a wave of stockpiling. The wafer prices had surged nearly 6.7%, while TOPCon cells saw an increase of over 3% amidst installation rush.
• The earthquake has raised market concerns over PV price. Market analysts highlight that the disruptions from the earthquake could hinder the ongoing efforts to resume wafer production. This could further tighten supply. will likely drive prices higher in the short term.
