Photovoltaic Industry Chain Special Report 1 — Polysilicon

In 2023, China had 22 operational polysilicon producers, with an effective capacity of 2.3 million tons per year and a production volume of 1.472 million tons—accounting for 91.6% of global output—and maintaining the world’s top position for the 13th consecutive year. Germany ranked second globally, producing 71,800 tons (including output from Wacker’s U.S. plant). South Korea ranked third, with OCI’s total output reaching approximately 33,500 tons (including production from its Malaysian facility). The United States ranked fourth, with combined output from Hemlock and REC totaling 19,000 tons (excluding production from German Wacker and Japanese Mitsubishi plants in the U.S.). Japan ranked fifth, producing about 11,500 tons. In the U.S., Hemlock’s 2023 output was approximately 17,500 tons. REC produced 1,103 tons of polysilicon, 1,101 tons of electronic-grade polysilicon, and sold 523 tons of electronic-grade polysilicon—a 50% year-on-year decline. Following Hanwha’s acquisition of REC shares in 2021, REC raised capital to restart granular silicon production in the U.S. In 2022, it invested $150 million to retrofit 12 fluidized-bed reactors (FBR), upgrade granular silicon packaging and handling systems, and build analytical laboratories. Its U.S. granular silicon production commenced as scheduled in Q4 2023, yielding 450 tons. Meanwhile, REC’s U.S. facility continues manufacturing silane-based CVD rod- and block-type electronic-grade polysilicon and silane gas. Wacker’s U.S. polysilicon plant began operations in 2015 but underwent shutdowns and safety rectifications twice—in 2017 and 2020—due to safety incidents and explosions. In 2023, affected by polysilicon price volatility and maintenance activities, its U.S. plant produced approximately 17,500 tons. South Korea’s only two polysilicon producers—OCI and Hanwha—both announced their withdrawal from domestic solar-grade polysilicon business in 2020. In that year, OCI announced capacity reductions for solar-grade polysilicon, fully exiting this segment in South Korea. In 2023, it converted its P1 production line to manufacture 4,700 tons annually of electronic-grade polysilicon; its solar-grade polysilicon production remained solely at its Malaysian facility. Its annual solar-grade capacity expanded from 27,000 tons in 2021 to 30,000 tons, and further increased by 5,000 tons in 2022—reaching 35,000 tons—through technological upgrades eliminating bottlenecks. In 2022, additional technical improvements added another 5,000 tons of capacity, bringing total capacity to 40,000 tons/year. Its 2023 output stood at approximately 28,800 tons. OCI also signed a cooperation agreement with Japan’s Tokuyama to leverage Malaysia’s hydropower advantages for producing 11,000 tons/year of primary electronic-grade polysilicon, subsequently shipped to OCI’s Gunsan plant in South Korea for finishing and sale. Overseas polysilicon production is concentrated primarily at Wacker, which had a total 2023 polysilicon capacity of 80,000 tons—distributed across Germany and the U.S.—and a total output of approximately 71,800 tons: ~54,300 tons from its German plant and ~17,500 tons from its U.S. facility. According to Wacker’s 2023 financial report, its polysilicon business unit achieved sales revenue of €1.599 billion, a 30% decrease year-on-year. The main reasons for the performance decline were significantly lower average prices for solar-cell-grade polysilicon both year-on-year and quarter-on-quarter, coupled with reduced sales volumes due to capacity constraints caused by equipment maintenance. The EBITDA (earnings before interest, taxes, depreciation, and amortization) for Wacker’s polysilicon business unit stood at €320.6 million—a 61.1% decline year-on-year.

TDI: Rising Raw Material Contract Prices and Continuously Declining Gross Profit Margins

Domestic TDI markets in China continued their upward trend last week. As of last Friday, ex-warehouse quoted prices for domestically produced TDI in the East China region (inclusive of VAT) ranged between RMB 15,200–15,500 per ton, up by RMB 1,300 week-on-week. The East China TDI market maintained its upward momentum. Market sentiment remained relatively stable, with demand driving price movements; however, transaction activity was modest, and market participants adopted a cautious, wait-and-see stance. The South China TDI market showed relatively stronger performance. Negotiations lagged, market dynamics remained persistently weak, and procurement remained largely demand-driven. The North China TDI market continued its upward trend. Prices operated at relatively low levels, downstream buyers displayed muted purchasing enthusiasm, and market sentiment grew increasingly cautious. Overall, the domestic TDI market in China remained firm and rose last week. Since the beginning of 2022, domestic raw material contract prices have risen, causing domestic TDI gross profit margins—which had already been declining throughout 2021—to continue falling. Overall inventory levels remained comfortable during the week, prompting many producers to maintain firm pricing. Some manufacturers limited sales to non-contract customers, while tight supply conditions led traders to hold stocks tightly and refrain from selling. Driven by sharp price increases in South China, low-price offers became scarce in both North and East China regions. Although overall market sentiment there was less robust than in South China, prices still demonstrated relative strength during the week. The restart timeline for Wanhua’s Fujian TDI facility has been postponed, and the supply volume from its Yantai facility remains uncertain. Overseas supply remains tight, with U.S. dollar-denominated prices edging higher. Dow Chemical’s Saudi Arabian TDI facility has resumed operations, providing some relief to overseas markets.

South Korean OCI Decides to Exit TDI Business

Sep 30, 2026

South Korean chemical firm OCI plans to exit the TDI business by December 2026 to enhance profitability, affecting its 50,000-ton annual capacity facility. This strategic adjustment impacts a segment contributing roughly 5.87% of the company's total sales.

ccin

2026-09-30

South Korean OCI Decides to Exit TDI Business

South Korean OCI Decides to Exit TDI Business

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