Chinese manufacturer Tongwei is to invest RMB28 billion (US$3.9 billion) in expanding its silicon production capacity.
Despite the looming prospect of overcapacity in the polysilicon industry in 2024, Tongwei said in a recent stock market filing that it was planning a new facility in the city of Ordos, Inner Mongolia, in northern China.
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In total, the company expects to produce 500,000 metric tons of industrial-grade silicon annually and 400,000 tons of polysilicon in the new facility.
The project is divided into two construction phases, with each phase expected to take 15-18 months to complete.
The first phase will result in production capacity of around 200,000 tons each, for both industrial silicon and high-purity crystalline silicon, with an estimated investment of around RMB13-14 billion. The aim is to complete construction and commence production by the end of December 2025. The second phase, the initiation of which will be subject to market conditions, will see production capacity increased by a further 300,000 tons for industrial silicon and 200,000 tons for high-purity crystalline silicon.
Tongwei highlighted that insufficiently secured production factors could impact the project’s initiation, production and goal attainment, potentially leading to adjustments in the project’s construction timeline. If, by the end of June 2024, collective efforts fail to meet the project’s energy consumption targets, any party involved may propose the unconditional termination of the project.
Amidst the backdrop of plunging silicon material prices, Tongwei is ramping up its production capacity.
Last year saw multiple declines in silicon material prices, with the average transaction price of polysilicon dropping from around RMB170,000 per ton at the beginning of the year to approximately RMB70,000 per ton.
On 13 December 2023, Daqo Energy unveiled a RMB15 billion investment plan for constructing a new silicon production plant, producing polysilicon, industrial silicon and round silicon cores.
Daqo Energy expressed its commitment to expanding the production capacity of high-purity polysilicon, increasing product output, and further solidifying its market share in the high-purity polysilicon sector.
The concurrent expansion of production by these two industry giants amid the downturn in silicon material prices can be seen as a significant market signal.
Tongwei and TÜV Nord will engage in an in-depth conversation in a webinar hosted by PV Tech showcasing the outstanding features and technological advancements of Tongwei’s new G12R n-type module. “N-type at the cutting edge: Insights into the innovation and reliability of Tongwei’s G12R module” will run at 1pm (GMT) on Tuesday 23 January 2024. Click here to sign up.