Thursday, April 10, 2008

Polysilicon quotes rocket high following sharp supply cut by MEMC

Nuying Huang, Taipei; Esther Lam, DIGITIMES [Thursday 10 April 2008]

Following MEMC Electronic Materials' sharp polysilicon supply cut to the spot market in the first quarter of 2008, corresponding quotes have shot to a new high at US$500-510 per kilogram recently, according to sources from solar wafer makers in Taiwan.

The sources noted that the shrink in supply led to a batch of about 20 tons of polysilicon being settled at US$500-510 per kilogram during the past two weeks. As the batch of polysilicon was secured through agents, information about the buyers is still unknown, but some industry players in Taiwan suspect that the buyers are likely from China, given that the market is rapidly growing, and that many China-based vendors have a relatively heavy reliance on the spot market.

Chin-Yao Tsai, general manager of E-ton Solar Tech, indicated that he had heard polysilicon was trading at a price tag above US$480-500, recently, but added in saying that he did not have further information say that whether the company had made any transactions at this price range. He added in saying that polysilicon spot pricing is expected to spur amid the upcoming suspension of solar tax incentives in Spain in September.

The sources explained the rocketing polysilicon price to MEMC's supply status. Since MEMC sought to guarantee sufficient supplies to its contract customers, including Gintech Energy from Taiwan and Suntech Power from China, during the last quarter, material supply was trimmed to the spot market in return. The polysilicon maker had also previously mentioned that its output would be reduced by 20% on quarter in the first quarter, and that some production would be affected by adjustments to its production facilities.

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