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**Abstract**
Polysilicon serves as a fundamental material in both the electronics and solar photovoltaic industries. In recent years, driven by the rapid growth of the global semiconductor and solar cell sectors, the polysilicon market has experienced significant expansion. However, this growth has also led to an imbalance between supply and demand, which has become a growing concern globally.
As energy demands rise and environmental pressures increase, renewable energy sources are gaining more attention from governments worldwide. Solar energy, in particular, has emerged as a key component of national sustainable development strategies. China's current renewable energy capacity stands at only 8%, indicating substantial room for future growth. The solar energy industry has made remarkable progress in research, industrialization, and market expansion, with the solar cell sector becoming one of the fastest-growing and most promising sunrise industries globally.
The solar cell market still holds immense potential. By 2006, cumulative global photovoltaic installations exceeded 8 GW, and investment in solar cell manufacturing surpassed $1 billion. According to EPIA forecasts, the global photovoltaic industry is expected to grow at an annual rate of 27% before 2009, reaching 34% from 2010 to 2020. By 2010, the global photovoltaic market could reach 11.34 GW, with major contributions from Japan, Europe, the U.S., and Other regions.
Currently, the global solar cell market is dominated by international players from Japan and Europe. However, Chinese solar cell companies have significantly increased their production capacity. Companies like Wuxi Suntech, Nanjing CLP, and Taiwan’s Modi have entered the top ten globally. Since 2005, the global solar cell market has faced shortages, driven by rising international demand, especially in Europe. This has created substantial growth opportunities for China’s solar photovoltaic industry.
Despite its rapid development, China’s solar cell industry faces several challenges. First, there is a shortage of raw materials, with over 90% of silicon materials imported, leading to high costs and low operational efficiency. Second, the domestic market lags behind the fast-growing industry, creating an imbalance. Third, China’s solar industry lacks advanced equipment, technology, and skilled personnel, requiring stronger innovation capabilities. Fourth, while the Renewable Energy Law has been implemented, supporting policies remain insufficient. Fifth, product quality varies, hindering long-term development. Lastly, many companies tend to follow trends, leading to overinvestment and risks of market overheating.
The demand for polysilicon is expected to remain strong. It is primarily used in semiconductors and solar cells, categorized into electronic-grade and solar-grade based on purity. With the growth of the semiconductor and photovoltaic industries, the global polysilicon market has expanded rapidly. In 2006, global solar cell production reached 2,521 MW, consuming about 23,000 tons of polysilicon—half of the total 45,000-ton demand. Production was around 37,000 tons, leaving a gap of nearly 8,000 tons. If calculated based on current solar cell capacity, the gap would be even larger.
International polysilicon producers, such as Hemlock (USA), Wacker (Germany), MEMC (USA), and Deshan (Japan), have expanded production capacity significantly. For example, Hemlock plans to increase output from 10,000 tons in 2006 to 31,000 tons by 2010. Wacker aims to double its production to 14.5 million tons by 2010. These expansions are expected to gradually ease the global supply-demand imbalance, leading to price declines and fiercer competition after 2010.
China’s integrated circuit and solar cell industries have driven significant polysilicon demand. From 2001 to 2006, demand for polysilicon in ICs grew at an average of 14.9% annually, while solar cell production increased by 157%. Over six years, both production and demand surged over 110 times. In 2006, China produced 551 tons of monocrystalline silicon for ICs and 370 MW of solar cells, requiring approximately 4,100 tons of polysilicon. Total demand reached nearly 5,000 tons, but domestic production was only 287 tons, highlighting a severe supply gap.
The rapid growth of solar cells has caused tight polysilicon supplies, forcing many companies to operate below capacity with yields of only 30–40%. This has led to sharp price increases and speculative behavior, encouraging domestic enterprises to invest and expand production.
Several domestic companies have started or expanded polysilicon projects. Luoyang Zhongsi High-Tech, Sichuan Xinguang Silicon Industry, and峨嵋 Semiconductor Materials Factory have launched new production lines. Additionally, Daquan Group, Jiangsu Zhongneng, Chongqing Chemical Medical Holding, and Wuxi Zhongcai have initiated large-scale polysilicon projects using both domestic and imported technologies.
New technologies, such as physical methods and metallurgical purification, are being explored to reduce costs and improve efficiency. Companies like Fangcheng Xuntianyu, Jinzhou New Century Quartz Glass, and others have made breakthroughs in producing high-purity solar-grade polysilicon.
With ongoing technological advancements and increasing investments, the polysilicon industry in China is expected to grow rapidly, contributing significantly to the global solar energy market.