Analysis on Polysilicon Industry in China

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Reviewed

Feb 4 2011

Research and Markets has announced the addition of the "Research Report on China Polysilicon Industry - 2011-2012" report to their offering.

As the raw material for two industries, polysilicon is on the one hand applied in the preparation for polysilicon wafer in the semiconductor industry which is used as the substrate of semi-conductor silicon chip, thus silicon materials must meet strict requirements of purity and adulteration specifications; on the other hand, it can be applied in the production of solar cell panel in the photovoltaic (PV) field by purchasing non-specific materials eliminated in the semiconductor industry.

Although the PV cell occupies a very small part of the power field in the world, its importance should not be overlooked. Polysilicon and monocrystalline silicon dominate the market. The monocrystalline processed with the scraps of silicon bulk can meet the requirements of solar cell which does not need ultra purity like that of silicon wafer used in the semiconductor device. At present, the consumption of the semiconductor industry is 2/3 of the polysilicon output, and the remaining 1/3 are applied in solar cells.

International polysilicon enterprises are mainly such 7 traditional ones as Hemlock, Wacker, REC, MEMC, Tokuyama, Mitsubishi, and Sumitomo, which occupied over 90% shares of global polysilicon market before 2008. After 2008, OCI company of South Korea emerged as a new force with the productivity expanded abruptly, reaching 17,000 tons at the end of 2010. As the demand for global polysilicon market continues to heat up, polysilicon giants excessively announced to expand production capacity by virtue of technical and financial strength. It is predicted that the production capacity of these international enterprises will see a continuous rise around 2012.

Due to the rising polysilicon prices in 2006-2008, a large number of investors were attracted to China. In recent years, the polysilicon industry has been a hot investment project in numerous new energy industries.

Many local governments in China take attracting polysilicon enterprises as the direction of introducing investment. Leshan of Sichuan, Chongqing, Wuhan, and Luoyang in Central and Western China, and Xuzhou, Yangzhou, Lianyungang, etc. in East China are called as the Polysilicon Bases. Since 2008, there have been over 10 large polysilicon projects under construction, many of which announced to have largest productivity in China themselves. But according to the market survey conducted at the end of 2010 by China Research and Intelligence, by the end of 2010, many of these projects have not been put into production due to lack of funds, technology, etc.

In 2010, China's polysilicon productivity reached 50,000 tons and the output exceeded 30,000 tons.

Benefiting from the rapid development of the PV industry, international polysilicon prices have been soaring since 2005, which reached 500 USD/kg in 2008. Influenced by the international financial crisis in 2008, the market price of polysilicon has been falling to be 40 USD/kg in April, 2010. But with the economic recovery and the reduction in the prices of PV units, the scale of global PV installation market is continuously expanded, which also expands the demand for polysilicon and gradually increases the price. In October, 2010, the international polysilicon spot prices ranged from 60-80 USD/kg, and the long-term order prices ranged from 55-60 USD/kg. In December 2010, the polysilicon spot price in Chinese market exceeded 100 USD/kg.

The initial investment in polysilicon is large. In general, every 1,000-ton polysilicon productivity entails about CNY 700-800 million. Besides, due to the long construction period (2 years), and the high technical threshold, the situation of dependence on import of polysilicon will last for some time, although the Chinese government has listed the PV industry as a strategic emerging industry in the future. In 2009, the import volume of China's polysilicon was about 24,300 tons, and the import value was about USD 1.70 billion. In 2010, the import volume exceeded 40,000 tons. Seen from the import sources of China's polysilicon, the import value of the U.S.A, South Korea, and Germany account for over 80% of the total.

The production technique of China's polysilicon enterprises still lags behind major foreign competitors to a certain degree, and the production cost of the majority of enterprises is above 40 USD/kg, while that of foreign advanced manufacturers is below 30 USD/kg. Besides, the majority of China's polysilicon enterprises have a small production scale, short production period, and inferior product quality. Seen from the polysilicon market price, China's polysilicon price is generally higher than that of the international market, and the competitiveness of China's local polysilicon enterprises is limited.

Since 2010, foreign polysilicon enterprises have expanded production substantially. For instance, OCI company of South Korea plans to invest USD 8.40 billion in 2010-2020, and increase its productivity from 35,000 tons/year currently to over 110,000 tons/year. Hemlock, Wacker Chemie AG, etc. are also expanding productivity. PV enterprises generally choose to place long-term orders for polysilicon in order to ensure the stability in the upstream supply of polysilicon. Therefore, foreign enterprises have advantages of output, quality, price, etc. of polysilicon, which will have an impact on China's polysilicon industry.

More following information can be acquired from this report:

Status Quo of China's Polysilicon Industry
Change Trend of China's Polysilicon Productivity
Change Trend of China's Polysilicon Prices
Major Polysilicon Manufacturers in China and Their Introductions
Import and Export of China's Polysilicon Industry
Introduction of China's Polysilicon Investment Projects
Prediction on Development Trend of China's Polysilicon Industry

Following people are suggested to buy this report:

Polysilicon Manufacturers
Polysilicon Equipment Manufacturers
Polysilicon Trading Enterprises
Polysilicon Downstream Enterprises
Investors Focusing on Polysilicon Industry
Research Institutions Focusing on Polysilicon Industry

Key Topics Covered:

Overview of Polysilicon Industry
Analysis on China's Polysilicon Industry, 2009-2011
Analysis on Major Polysilicon Manufacturers in the World, 2010-2011
Analysis on Major Monocrystalline Silicon/Polysilicon Manufacturers in China, 2010-2011
Forecast on Investment and Development of Chinese Polysilicon Industry, 2011-2012

Companies Mentioned: