Ban On Scrap Polysilicon To Boost China Solar Sector

A Chinese ban on imports of a waste material used for solar wafers may be bad news for foreign competitors but it is a big boost to China's solar sector.

Scrap polysilicon, which can be reused to make solar wafers, is low-grade silicon that fails to meet the grade for chips found in most electronics.

Beginning this month, China stopped accepting scrap polysilicon to comply with environmental regulations.
The ban threatens the income of Chinese scrap polysilicon traders and limits the market for companies that sell to them, such as top contract chipmaker TSMC. It is particularly harsh for small and new domestic solar players who rely on the cheap material to make wafers and panels.

For China's polysilicon companies, including GCL-Poly Energy Holdings and LDK Solar, the ban is an opportunity to expand business. For foreign rivals South Korean OCI Co Ltd, MEMC Electronic Materials Inc or Japan's Tokuyama Corp the ban is a potential threat.

China produces over 60 percent of the world's solar panels, and is among the heaviest users of pure polysilicon and the scrap variety. Scrap polysilicon accounts for up to 30 percent of silicon fed into some of the solar wafers and panels in China.

SOURCE : REUTERS