Chinese polysilicon makers driving industry’s second great consolidation


The dramatic expansion of Chinese polysilicon manufacturers is driving a second big reorganization of the solar-grade poly industry, according to commentator Johannes Bernreuter.

The industry expert behind Germany-based poly market analyst Bernreuter Research has published a new report today highlighting the polysilicon makers forced out of business by the big Chinese players and predicting the world will need huge rises in the volume of solar power generation capacity deployed to avoid a glut of the raw material as early as 2022.

A press release issued today by Bernreuter Research, to publicise the Polysilicon Market Outlook 2024 report, predicted the world would need to deploy 270 GW of new PV in 2023 – up from the analyst's prediction of 127 GW this year – to avoid polysilicon oversupply, with almost 75% of the world's semiconductor and solar-grade material already pouring out of China this year.

The analyst said solar wafer makers Longi Solar and Zhonghuan Semiconductor are leading the insatiable thirst for monocrystalline polysilicon which is likely to drive supply constraints next year, before then tipping into likely oversupply.

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Bernreuter highlighted the fact Chinese poly maker Tongwei this year overtook German manufacturer Wacker as the world's biggest polysilicon supplier and also mentioned huge fluidized bed reactor expansion plans at compatriot business GCL-Poly.

The rush to higher-grade, monocrystalline polysilicon production had forced 14 small and medium-sized Chinese rivals out of the business between 2017 and last year, according to the analyst, mostly polycrystalline producers. And with all three South Korean polysilicon producers having halted production, Norwegian business REC Silicon having mothballed its Moses Lake fab in the U.S., and U.S.-based, Corning Inc-owned Hemlock Semiconductor having halved production, Bernreuter said the current industry shakedown had removed 275,000 metric tons of annual poly production capacity from operation. That figure is more than double the 135,000 metric tons removed in the previous consolidation, witnessed from late 2010 to early 2013.

Bernreuter predicted the Chinese polysilicon producers will drive the price of the solar panel raw material below $8/kg in 2022, and possibly below $7/kg.

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