The critical export situation forces the production of over 50,000 tons of polysilicon

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On November 11, the **Statistics Bureau released the data on key indicators of the national economy for October. Data shows that crude steel production was 51.75 million tons, an increase of 42.4% ； Cement: 160 million tons, a increase of 23.9%. 　　Yuan Lei, a researcher at the Institute of Industrial Economics of the Chinese Academy of Social Sciences and one of the authors of the MIIT’s \"Quarterly Report on the Operation of China’s Industrial Economy,\" said that the investment boom in many regions persists to this day. Industries such as steel, building materials, cement, and shipbuilding, which already face warnings of overcapacity, remain popular areas for investment. And this overcapacity will become more apparent in 2010, bringing new risks. 　　The six industries with overcapacity that were specifically identified by the executive meeting of the State Council are steel, cement, flat glass, coal chemical industry, polysilicon, and wind power equipment. 　　Relevant officials from the Ministry of Industry and Information Technology said in interviews with our newspaper that for all the industries mentioned, the ministry will formulate detailed guidance guidelines and entry requirements. “For some industries, capacity needs to be restricted; for others, mergers and reorganizations are required, while yet others require both,” these guidance guidelines will be released gradually. 　　“Continue to operate at full capacity after being \"named\" According to an executive from a photovoltaic company, after being \"named,\" the \"new energy industry plans\" that are being promoted vigorously in many places have essentially come to a standstill. Many polysilicon projects that did not involve civil construction have been halted, and many projects that were already in the civil construction phase have also begun to be reassessed. 　　Polysilicon and wind power equipment manufacturers are facing even greater credit constraints. “These days, many banks are extremely wary of anything related to ‘crystals’ or ‘wind’, making it increasingly difficult to obtain loans. ”The executive said. 　　Meng Xiangan, vice president of the Chinese Society for Renewable Energy, said that there is actually no overcapacity in polysilicon production at present. In 2008, a total of 5,000 tons of polysilicon were produced nationwide, accounting for 20% of the country’s total demand. In 2009, it is estimated that the national production of polysilicon will reach around 10,000 tons, accounting for about half of the total domestic demand; thus, a large amount of polysilicon still needs to be imported. ” 　　However, due to the previous boom in the new energy sector, investing in polysilicon became a trend. Meng Xiangan believes that driven by this boom, the polysilicon industry has seen duplicate construction, with many production lines of low technical complexity being put into operation in a hasty manner. 　　Based on the polysilicon production project launched in 2009, the production capacity of polysilicon is expected to reach 50,000 to 60,000 tons by 2010, and 170,000 to 180,000 tons in a few years. 　　“A capacity of 50,000 to 60,000 tons is not considered excessive in terms of the domestic market, but the trend of making blind investments in polysilicon production lines with low technical standards does warrant attention. ”Meng Xiangan said. 　　Although the investment boom has cooled down, all production lines of polysilicon manufacturers are still operating at full capacity. The CEO of a polysilicon manufacturing company told our reporter that it is currently the end of the year, and almost all manufacturers are working overtime to meet production deadlines. “The end of the year sees high demand from the European market. Moreover, given this year’s trends, there might be changes in the level of support for the photovoltaic industry in Europe next year; therefore, manufacturers are rushing to produce as much product as possible before any policy changes take effect at the end of the year.” And due to the unclear policies, the demands from domestic companies have been temporarily put on hold. ” 　　Now, one concern for photovoltaic manufacturers is this: if, after policy adjustments in 2010, demand for polysilicon in the European market declines, and the domestic market has not yet been fully developed, then the risk of overcapacity will truly emerge. 　　“New investment wave in emerging strategic industries On September 29, the State Council issued a notice titled \"Several Guidelines on Curbing Overcapacity and Redundant Construction in Certain Industries and Promoting the Healthy Development of Industries.\" The notice called for strict control over the establishment of new polysilicon projects in areas facing energy shortages and high electricity costs; projects that lack proper comprehensive utilization facilities or do not meet environmental standards were not to be approved or registered. The scale of new polysilicon projects was required to be at least 3,000 tons per year. 　　In this regard, Meng Xiangan believes that the purpose of the access system is to establish \"thresholds\" for entering the polysilicon production industry based on three aspects: industry scale, energy consumption, and environmental protection standards. This can effectively prevent blind and irrational investment. 　　However, there is much debate in the industry regarding the limit of 3,000 tons per year. In terms of production capacity, meeting the standard of 3,000 tons per year requires an investment of around 2 billion yuan. Many experts believe that the purpose of setting this threshold is to encourage companies to pay more attention to energy consumption metrics and to invest in independent research and development, as multiple indicators are used for comprehensive evaluation. Some companies believe that the target of 3,000 tons per year will keep many private enterprises out. 　　Other industries named also face similar problems. 　　The overcapacity in the new energy industry is determined by its stage of development. “Judging from the current development trends, given the rapid pace of growth, a certain degree of overcapacity is normal and beneficial to the development of the industry. What needs to be curbed is malicious and irrational investment. ” 　　However, Yuan Lei also pointed out that it cannot be ignored that, as the new energy industry is an emerging and developing sector, a breakthrough in technology can lead to a doubling or even tenfold growth of the industry. The new energy development plans, which have been doubling in recent years, also corroborate this claim. Therefore, these factors cannot be ignored in the process of formulating guiding policies. 　　However, with the introduction of the concept of \"emerging strategic industries,\" a new wave of investment enthusiasm is emerging. According to senior executives from photovoltaic companies, many regions are currently formulating \"development and revitalization plans for emerging strategic industries.\" They are selecting those industries that are suitable for their own development, creating plans for them, and waiting for the right time to launch these initiatives. ” 　　According to Yuan Lei’s investigations, although credit conditions have tightened at present, \"if local governments’ investment enthusiasm matures, the bank credit departments remain very cooperative.\" ”