STOCKS | China Solar Stocks Jump Late on Rumors of Mandatory Efficiency Standards

China’s solar sector reversed earlier weakness in late trading on June 10, with several major photovoltaic names surging amid market talk of potential new mandatory standards. According to Jin10, JA Solar and Aiko Solar hit their daily limit-up, while LONGi Green Energy moved close to the limit-up level, as funds reportedly poured into the sector during the final half hour of trading. The rally was linked by market participants to an afternoon rumor that mandatory photovoltaic standards could be released next week, covering polysilicon, wafers, and modules, and potentially leading to the exit of about 30% of capacity based on prior guidance. The Paper said it contacted multiple companies mentioned in the market chatter. The companies said they had noticed the claim but could not verify its authenticity. While the rumor remained unconfirmed, policy expectations have recently strengthened. During the SNEC solar and energy storage exhibition held last week, a photovoltaic company executive said that, based on their understanding, a closely watched mandatory “tier-three” energy-efficiency standard might be introduced soon. The executive said companies with clear technical advantages but facing slow industry-wide capacity reduction have been looking to such a policy as a technical basis for procurement tenders that favor stronger products and phase out outdated ones. The executive added that companies unable to meet the standard would face difficulties, including potential tightening by financial institutions if firms lack the capability to carry out further technical upgrades, and argued the tier-three efficiency standard should be introduced as soon as possible and continuously improved.