Solar manufacturer Xinyi Solar is to diversify into polysilicon production, launching a joint venture to establish a production base in Yunnan, China, with an initial capacity of 60,000 metric tons (MT).
In a statement issued to the Hong Kong stock exchange late last week, the boards of both Xinyi Solar and Xinyi Glass confirmed that they had agreed to establish Xinyi Silicon, an entity 52% owned by Xinyi Solar, to develop polysilicon production facilities in China.
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Under the joint venture agreement, the two companies are to provide funding of up to RMB3.3 billion (US$517 million) to finance the construction of polysilicon production facilities in Qilin District, Qujing City, Yunnan Province.
The facility is expected to have an initial production capacity of 60,000MT per year, however the companies have stated this could be subsequently increased to 200,000MT per year through the completion of additional phases.
It’s expected that Xinyi Silicon is to invest some RMB6 billion, with any shortfall expected to be made up by external sources of finance.
Qujing Municipal Government has meanwhile agreed to provide various policy and administrative supports to Xinyi, including the acquisition of land rights and construction works.
Xinyi’s launch of a polysilicon production unit comes at a time of highly inflated polysilicon prices, driven by demand far outstripping in supply throughout most of this year. While new production capacity is expected to come onstream over the course of 2022, most forecasts have polysilicon prices remaining comparatively high long into next year, only normalising in H2 2022 and beyond.