Volume 89 Issue 18 | p. 8 | News of The Week
Issue Date: April 29, 2011

OCI Bets On Polysilicon

Investment: South Korean firm will build world’s largest plant for the ubiquitous material
Department: Business
Keywords: polysilicon, South Korea

South Korea’s OCI will spend nearly $1.7 billion to build what it claims will be the world’s largest single polysilicon plant. The company expects the 24,000-metric-ton-per-year facility to come on-line in 2013.

Polysilicon is used to create semiconductor wafers as well as high-efficiency photovoltaic cells. Both markets are healthy, although the photovoltaic industry, OCI’s target sector, is growing faster.

OCI acknowledges that it is investing at a time when the polysilicon market is becoming oversupplied. In South Korea and elsewhere, many producers are expanding capacity. “But by building larger, you get economies of scale,” an OCI spokeswoman tells C&EN. The firm’s polysilicon will be able to compete even if prices drop, she contends.

Polysilicon oversupply will begin in 2012, predicts Henning Wicht, a Munich-based principal analyst at IHS iSuppli, which provides market research services to the electronics and solar energy industries. The oversupply will develop because the leading polysilicon producers—OCI, Hemlock Semiconductor, Wacker Chemie, and GCL-Poly—are substantially expanding capacity at the same time that dwindling solar power subsidies in Europe are putting a damper on growth.

Yet OCI’s investment makes sense, Wicht adds, because all major polysilicon suppliers will compete on the basis of scale and costs. “The OCI expansion has to be seen in that context. Of many newcomers that have emerged since 2006, there is not one but OCI remaining,” Wicht says.

OCI says adding the new facility, in South Korea’s North Jeolla province, will make it the world’s largest producer of polysilicon. iSuppli projects that OCI will be the leading producer in 2013 and 2014 but that Hemlock will regain its leadership in 2015 when it completes facilities in Clarksville, Tenn.

 
Chemical & Engineering News
ISSN 0009-2347
Copyright © American Chemical Society

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