Polysilicon supply catches up

SAN JOSE, Calif. -- After years of shortages in the solar-cell sector, polysilicon supply should catch up with the demand this year, according to Frost & Sullivan.

In total, the global solar photovoltaic market generated sales of $6.49 billion in 2005 and estimates this to reach more than $16 billion in 2012, according to the research firm.

This growth generated a huge demand--and shortages- of polysilicon. It was estimated that the demand for silicon feedstock neared 26,000 tonnes in 2004, but there were still severe shortages of the materials, according to the firm.

In 2005 there was a rise in wafer production by nearly 7 percent. But in 2006, ''the shortage of feedstock reached a critical point affecting the production of solar panels and, consequently, the industry growth,'' according to the firm.

“We expect polysilicon supply to catch up with the demand already in 2008,” said Alina Bakhareva, an analyst with Frost & Sullivan. “The majority of the new quantities will be supplied to the market by top 4 producers that are expanding their existing production capacities.”

In fact, four top polysilicon producers are expected to add more than 17,000 tonnes of capacity in 2008. This would represent over 50 percent increase over their current capacities, he said.

On the demand side, demand from the semiconductor industry is expected to grow at steady one-digit rates. Demand for solar-grade polysilicon is expected to reach over 50 percent of the total demand for high purity silicon in 2008-2009, he added.