In the rare earth business China undercut every producer in the world and continued the underpricing until the non-Chinese mines closed. We may be seeing a similar strategy in solar.
From Barron's Tech Trader Daily:
First Solar: Credit Suisse Sees Threat From China Poly Glut
Credit Suisse solar energy technology analyst Satya Kumar today cut his price target on shares of First Solar (FSLR) to $100 from $115, and reiterated a Neutral rating, based on his expectation that a build-up of polysilicon production in China will lead to lower silicon-based solar panels, which will in turn put pricing pressure on First Solar.See also the link to Barron's "Lazard: "Solar Stocks Don't Reflect Upside Potential" (FSLR; TSL)"
Global solar panel won’t absorb all of China’s polysilicon product unless that demand swells to 30 gigawatts this year, something he sees unlikely, or unless prices fall dramatically, perhaps as low as $1 per watt for Chinese-produced panels.
“We expect First Solar’s competition with China-based c-Si companies to enter a more aggressive phase of the next six months, writes Kumar....MORE