2014年MPACC英语阅读素材(6)

　　In China's Jiangsu province, near Shanghai, mountains of solar panels sitting around a factory owned by Trina Solar Ltd (TSL.N) are fast losing their value.

　　Trina and other Chinese solar companies, including Suntech Power Holdings Co Ltd (STP.N) and Yingli Green Energy Holding Co Ltd (YGE.N), hold inventory of about 5 gigawatts (GW), analysts say, nearly one-sixth of annual global demand.

　　The stockpiles would be valued at about $4.5 billion based on the average selling price of 87 cents for a panel in the second quarter, but the glut means prices are falling fast.

　　The companies, which face a steep anti-dumping duty in the United States and possible tariffs in top market Europe, have few options but sell the existing excess cheaply in China.

　　"With the anti-dumping investigation starting in Europe, Chinese companies are avoiding shipping to the continent at the moment," said analyst Stefan de Haan at business information provider IHS Inc.

　　"This will further increase inventory over the next few weeks or so."

　　Companies have already started slashing production but they have a long way to go. Chinese makers have the capacity to produce 50 GW of solar panels a year -- well above global annual demand for 30 GW.

　　Analysts have taken note and have pushed up their loss forecasts for Yingli, Suntech, Trina and JA Solar Holdings Co Ltd (JASO.O), Thomson Reuters StarMine data shows.

　　Panel prices are already the lowest in China and they are expected to fall further below 58 cents per watt, according to IHS. It says prices in the United States, Canada, and Mexico are expected to be 69 cents per watt.

　　EUROPEAN BLUES

　　China sold about 21 billion euros ($27.42 billion) in solar panels and components to the European Union in 2011 -- some 60 percent of all Chinese solar exports.

　　But the regulatory problems have come on top of the global glut -- which formed after Chinese manufacturers ramped up production just as top European markets cut subsidies.

　　Stockpiles of solar panels at Chinese firms now average about 110 days of sales, three times the 42 days of inventory averaged globally, Thomson Reuters data shows.

　　European solar companies, led by Solarworld AG (SWVG.DE), allege that Chinese producers sell panels below market value, prompting a European regulatory investigation.

　　Chinese companies have denied the charges, but to minimize losses from any eventuality, some are looking to cut production. Suntech, the world's largest solar panel maker, said on Monday it would slash its capacity to produce cells, used to make panels, by a quarter.

　　To get rid of excess inventory, Trina has also lowered production, raised sales in China and is looking at newer markets, said Thomas Young, a spokesman for the company.

　　DEEPER CUTS NEEDED

　　GTM Research analyst Shyam Mehta said about 15 GW of Chinese capacity needs to be taken offline for supply and demand to come into a balance.

　　"Given the continuing price pressure in the sector, with very little hope of the prices stabilizing at the current levels, it is still the best strategy to try to keep your inventories as low as possible, and sell your products," said Thiemo Lang, senior portfolio manager at Zurich-based Sustainable Asset Management.

　　Lang, who manages a fund that has $900 million in cleantech assets under management, says solar panel and cell companies offer little value now because of the chronic oversupply and regulatory uncertainty.

　　The glut has already sent prices crashing, with solar panels, which cost as much as $4.20 a watt in 2008, diving 80 percent in the past four years.

　　Most of the Chinese companies wrote down the value of their inventory in the second quarter and their shares have lost about three-quarters of their value in the past year.

　　With doors to Europe and the United States closing, Chinese companies have to sell at home, but that market would have to expand massively to cater to their production.

　　China's consumption of solar power products is expected to jump to about 3.5 GW in the second half of the year from 2 GW in the first, Mehta said.

　　The country last month raised its 2015 target for solar power capacity by 40 percent to about 21 GW, the third rise in just over a year -- but sales are needed now, in 2012.

　　"The Chinese companies (would be) more than willing to try to deploy their modules in their own country, but it seems that the overall Chinese market won't be more than 4 GW this year, and that the pricing will be quite poor," said Lang.

　　While most other companies have much lower inventories, two U.S. firms, SunPower Corp (SPWR.O) and First Solar Inc (FSLR.O), had stocks just 15 days lower than their Chinese rivals, yet they were among the very few profitable solar companies in the June quarter.