Report
GCL-Poly to Abandon Pricey US Expansion Plans
2023-04-26 9:30   | Editor:et_editor   |    310 Numbers

Bloomberg reports, “US policies are attractive, but not attractive enough.” GCL-Poly Energy Holdings, the world’s second-largest manufacturer of polysilicon, is considering opening its first overseas factory. However, it may abandon plans to build a factory in the United States due to high costs.

CEO Lan Tianshi has stated that the company wants to enter foreign markets with higher-priced products. Furthermore, countries around the world are striving to develop their own supply chains in hopes of competing with China’s solar industry.

Lan further said that by passing last year’s Inflation Reduction Act (IRA), the US government has taken steps to encourage manufacturers to establish themselves in the United States. However, the cost of building a factory in the United States is still five times more expensive than in China and construction times are often bogged down by regulatory requirements. Although a decision has yet to be made, GCL has been refocusing its effort onto Europe, the Middle East, and BRICS countries.

Lan has also expressed GCL plans to establish factories in partnership with local industries and are set to make an announcement before the end of the year. Given the higher prices of polysilicon outside of China, GCL could see profits from overseas factories being two to three times that of Chinese factories.

Polysilicon is a material composed of single-crystal silicon, which is melted down, cooled into blocks, and sliced into small squares before being formed into solar cells. In recent years, soaring demand has exceeded the capacity of existing factories, causing prices last year to surge to the highest they’ve been in a decade. In 2022, GCL saw their net income more than double.

Polysilicon prices may fall as low as $10 to $13 per kilogram in the second half of the year—compared to last year’s peak of $39—with the commissioning of new factories. Lan predicts future prices will be more flexible than expected, ranging between $17 to $20 in 2023, due to strong demand for high-quality materials. Polysilicon markers are set to a return to a relatively normal profit margin this year as the imbalance between supply and demand begins to ease.

 (Image Source: Unsplash

 
Tags:polysilicon
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