The polysilicon industry may see a period of prosperity in 2010

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Review of the polysilicon industry in 2009: On September 26, 2009, the State Council issued the \"Several Opinions on Curbing Overcapacity and Redundant Construction in Certain Industries and Promoting the Healthy Development of the Industry\" prepared by 10 ministries and commissions including the National Development and Reform Commission and the Ministry of Industry and Information Technology (hereinafter referred to as Document No. 38). This document officially included polysilicon among the industries suffering from overcapacity and redundant construction; local authorities were instructed to tighten regulations on polysilicon projects, and most new polysilicon projects that had not yet received approval were halted. In 2009, domestic polysilicon production will reach 10,000 tons, but nearly 20,000 tons of polysilicon will still need to be imported. After accounting for domestic production, another 10,000 tons need to be imported. The shortage of polysilicon is significantly severe; therefore, the so-called surplus is a matter of statistical classification – it is a planned surplus. 　　Analysis and statistics of polysilicon production capacity from 2005 to 2010: In 2005, the global production of solar-grade polysilicon was 8,100 tons, while the total demand for solar-grade polysilicon materials that year was 16,333 tons. Assuming a proportion of 65% for polysilicon (with the remaining amount being monocrystalline), the demand for polysilicon was 10,616 tons, resulting in a shortfall of 2,516 tons ； In 2006, the production was 10,800 tons, while the demand was 13,800 tons, resulting in a shortfall of 3,000 tons ； In 2007, the demand was 16,560 tons, the output was 15,100 tons, resulting in a shortfall of 1,461 tons ； By 2008, it was basically balanced. 　　In 2008, China’s demand for polysilicon was 25,000 tons; actually, only 5,000 tons were produced domestically, with 80% of the remaining amount being imported. As of December 2008, more than 10 listed companies in China had invested in polysilicon projects; the announced investment amounts totaled nearly 6 billion yuan, with the overall investment amount reaching over 30 billion yuan. 　　Overall, mainland China’s polysilicon production in 2010 was around 35,000 tons; it is estimated that this amount will still only meet half of the market demand, leaving a need to import another 30,000 tons. On January 19, 2010, a symposium on the \"Access Standards for the Polysilicon Industry\" was held in Beijing; this was likely done as preliminary preparation, and our newspaper predicts that the polysilicon industry is set to return to rationality. 　　The \"Access Standards for the Polysilicon Industry\" formulated by the Ministry of Industry and Information Technology set scale thresholds first, in order to curb the excessive growth of the polysilicon industry. Furthermore, the Standards stipulate that the scale of new polysilicon production facilities must be greater than 3,000 tons per year; the land area required per thousand tons of polysilicon must be less than 6 hectares. The electricity consumption for the reduction of polysilicon to solar-grade material must be less than 60 kWh per kilogram. The recovery rates of silicon tetrachloride, hydrogen chloride, and hydrogen from the reduction process must be at least 98.5%, 99%, and 99%, respectively ； Guide and support polysilicon enterprises in establishing integrated operations that combine polysilicon production, power generation, and chemical manufacturing through various means, and support the development of energy-saving and environmentally friendly solar-grade polysilicon technologies to reduce production costs. 　　Based on the industry analysis from 2010, nationalized enterprises are paying attention to the new developments in the polysilicon market: GCL-Poly Energy Holdings Co., Ltd. is China’s largest polysilicon producer, a leading global supplier of silicon wafers, and also one of China’s top environmental-friendly power operators. The group’s annual polysilicon production capacity reached 18,000 tons by the end of 2009, and is expected to reach 21,000 tons by the end of 2010. The group has begun building silicon wafer production facilities, with an annual production capacity of 2 gigawatts expected to be achieved by the end of 2010. 　Building on the full operation of Yongxiang’s 1,000-ton/year polycrystalline silicon production facility in 2009, and on Tongwei Group’s establishment of Tongwei Solar Co., Ltd. to create a complete photovoltaic industry chain, the board of directors of Yongxiang Corporation decided to pursue a strategy for expanding Yongxiang’s polycrystalline silicon production capacity from 1,000 tons per year to 22,000 tons per year. It was also decided that two supporting projects related to the 1,000-ton/year production facility would be launched officially after the Spring Festival in 2010: projects for the annual production of 20,000 tons of trichlorosilane and for the hydrogenation of silicon tetrachloride. 　　Xinguang Silicon Industry attended the Beijing roundtable for enterprises on the \"Access Standards for the Polysilicon Industry\" on January 19. The company designed its polysilicon production lines for a high-end market segment. Due to the booming polysilicon market in previous years, the prices of polysilicon used in solar applications and that used in electronic applications were similar, so the company did not immediately modify its production processes to manufacture polysilicon for electronic uses. Currently, the price of electronic-grade polysilicon is around $130 per kilogram. With the sharp drop in the price of solar-grade polysilicon (to around $40 per kilogram), the price advantage of electronic-grade polysilicon becomes more evident. The company plans to work on improving the production processes for high-end electronic-grade polysilicon in 2010, and it is expected that sales of this type of polysilicon could account for around 10% of total sales in the future. Due to the high price of polysilicon for electrodes, significant profits can be achieved after the process modification is completed. 　　The polysilicon project of Suihua Baoli Photovoltaic Materials Technology Co., Ltd. has a total investment of 256 million yuan. It was the first in China to apply the metallurgical method for polysilicon production on an industrial scale, offering advantages such as low investment, short energy recovery time, favorable environmental impact, and low production costs – all of which make it suitable for manufacturing solar photovoltaic cells. 　　In collaboration with the Chinese Academy of Sciences, Baotou Shansheng New Energy Company completed China’s most advanced solar-grade polysilicon production line by the end of December 2009. Recently, a batch of 50 single-crystal silicon furnaces, 15 polycrystalline silicon furnaces, and 20 slicing machines were put into operation. By 2012, a production capacity of 1,000 MW will be established for polysilicon, as well as for the processes from pulling single crystals (or producing polycrystalline ingots) to slicing and manufacturing solar panels; the total investment will amount to 5.6 billion yuan ； The annual output value of this enterprise is expected to reach 10 billion yuan, with annual tax payments of over 1 billion yuan; it is gradually becoming a new industry in Baotou City. 　　Technological breakthroughs are needed in the polysilicon industry. Technical issues related to polysilicon have always attracted considerable attention. Despite the large scale and production capacity of the polysilicon industry, the country has long been plagued by a lack of technical core capabilities, especially in the technology required to convert silicon raw materials into polysilicon. It is reported that once established, the Jiangsu Chlorohydration Technology Engineering Center will leverage Jiangsu Zhongneng’s existing leading domestic capabilities in chlorohydration technology research and development, as well as the talent, scientific resources, and informational advantages of various universities, to accelerate the improvement of R&D capabilities in the photovoltaic industry and enhance its core competitive strengths. This will provide strong support for technological progress in the polysilicon industry, and it holds great significance for Xuzhou in accelerating the development of a world-class polysilicon production and R&D base.