China Solar Faces Regulatory Reset With Halt to Coordinated Controls
A symposium held by the State Administration for Market Regulation or SAMR on Thursday urged photovoltaic manufacturers and industry associations to suspend so-called “anti-disorderly competition” and “industry self-regulation” measures implemented through coordinated controls on production capacity, sales volumes and pricing, citing monopoly risks.
According to media reports, the entities requested to be represented at the symposium included the China Photovoltaic Industry Association or CPIA, and leading manufacturers such as Tongwei, GCL Technology, Daqo New Energy, Xinte Energy, Asia Silicon and East Hope. The symposium highlighted potential antitrust risks in production, sales and operational activities across the solar value chain and issued clear rectification requirements to strengthen compliance with competition law.
As part of the rectification process, the association and the companies involved have been instructed to conduct a comprehensive review of existing practices and submit written corrective action plans to SAMR by Jan. 20. The rectification plans are subject to the following conditions:
(i) No agreements may be reached on production capacity, capacity utilization rates, production or sales volumes, or selling prices;
(ii) No market share segmentation, output allocation or profit distribution may be conducted in any form based on capital contribution ratios; and
(iii) The association and enterprises must refrain from any current or future communication or coordination involving sensitive information, including prices, costs, and production or sales volumes.
While neither the symposium nor its conclusions have been officially confirmed, multiple sources told OPIS that the meeting did take place and triggered a sharp decline in polysilicon futures prices. Data from the Guangzhou Futures Exchange show that settlement prices for polysilicon contracts with January-December 2026 delivery fell to 54.975 yuan-56.605 yuan ($7.831-$8.063)/kg on Jan. 8, from 58.385-60.615 yuan/kg in the prior session, before declining further to 51.125-53.190 yuan/kg on Jan. 9.
Background and Impact
Since late 2024, China’s PV industry has pursued initiatives aimed at curbing “anti-disorderly competition” amid persistent overcapacity, falling prices and deteriorating profitability, aimed at moving from rapid capacity expansion toward higher-quality development. The CPIA has played a central role, organizing self-discipline agreements, discouraging low-price competition, establishing indicative price floors, and exploring quota-based mechanisms for production and sales.
A key development under this framework was the establishment of a platform entity backed by leading polysilicon producers to acquire and permanently retire inefficient capacity and restore supply-demand balance, as OPIS earlier reported. The platform was formally registered on Dec. 9, with 10 shareholders, including Tongwei Solar, GCL Technology, East Hope, Daqo New Energy, Xinte Energy, Asia Silicon, Qinghai Lihao, Beijing Zhongguang Tonghe, Xiexin New Energy and Qinghai CSG New Energy.
The move attracted widespread industry attention, with some market participants viewing it as the long-anticipated launch of a consolidation platform for China’s polysilicon sector and a critical step toward curbing cut-throat competition.
However, an industry source said that SAMR’s recent actions could lead to the forced suspension of the polysilicon consolidation plan. Comparing the companies involved in the symposium with the shareholders of the platform entity, the source said the regulator’s intervention appears aimed at dismantling arrangements perceived to carry supply-side monopoly risks.
“This policy reversal could trigger short-term volatility in polysilicon prices,” the source added, noting that leading producers are likely to be most affected. Without favorable policy or mechanisms to address excess capacity, uncertainty surrounding the sector’s earnings outlook for 2026 is expected to increase.
Market Response and Outlook
Following the symposium, industry sources told OPIS that no polysilicon transactions have been observed, leaving spot prices temporarily unchanged. Market participants are adopting a wait-and-see approach ahead of the Jan. 20 submission deadline, amid uncertainty over how production, sales, and pricing behavior may be constrained going forward.
Other sources emphasized that SAMR’s intervention is not intended to directly oppose industry self-discipline or remove market regulations. A sudden return to unfettered competition could drive prices across the value chain to new lows, inflict widespread losses, waste resources, and undermine the structural foundation of China’s PV industry–an outcome widely seen as unlikely.
Instead, market participants believe that constraints on capacity, production and pricing remain necessary but must be implemented within a transparent and legally compliant framework–an approach widely seen as the core objective of the SAMR’s move. Rather than relying on coordination over production and sales volumes, an observer suggested that the market could tighten technical and environmental standards, such as energy and water consumption as well as carbon emissions for polysilicon production; and efficiency, degradation rates and service life for cell and module manufacturing. Such measures would curb new capacity additions while accelerating the exit of non-compliant facilities, improving product quality and technological progress while indirectly regulating supply.
On pricing, a market participant noted that China’s Price Law already prohibits sales below cost. Until overcapacity is structurally addressed, the next phase of industry price discipline is therefore expected to anchor polysilicon prices near breakeven levels, with average prices potentially stabilizing around 50 yuan/kg for some time.
–Reporting by Summer Zhang, szhang@opisnet.com; Editing by Mei-Hwen Wong, mwong@opisnet.com