South Korea-based polysilicon supplier OCI has cancelled all three of its long-term supply contracts with Suntech’s Chinese operations in response to subsidiary Suntech Wuxi entering bankruptcy proceedings.
OCI said in a statement that the outstanding balance of the long-term contracts stood at US$1.36 billion. Two of the contracts go back to 2008 when polysilicon was in chronic short supply. The most recent contract was signed in 2011.
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However, the company noted that it would attempt to continue to service Suntech Wuxi with polysilicon supplies as the company works on restructuring its operations. Suntech Wuxi was a major customer of OCI.
According to reports, Suntech Wuxi would have accounted for approximately 9% of OCI’s 2012 total revenue. A company spokesperson was said to be unable to reveal the sum of outstanding payments of Suntech Wuxi to OCI.
OCI recently announced first quarter 2013 polysilicon sales of approximately US$200 million.
