Securing Silicon Metal for Solar

OCI subsidiary Elpion is building a 100000 Metric Ton (MT) silicon metal plant in Malaysia.

Backing their global #1 polysilicon market share ambitions, the OCI Company Ltd. (SEO:010060) Q1 2011 Financial Results presentation detailed the investment by subsidiary Elpion Co., Ltd. in a 100000 MT per year capacity silicon metal (metallurgical silicon, mg-Si) plant being built in Banting, Malaysia, “to diversify supply sources”. Elpion will invest $205 million constructing the mg-Si facility in two 50000 MT per year capacity phases. Phase 1 (P1) has begun construction and is expected to be completed by June 2012, while Phase 2 (P2) will start construction in March 2013 with completion expected by June 2014. OCI claims the quartz (silica or SiO2) for the plant is being sourced from a local mine about 16 kilometers (10 miles) west of Kuala Lumpur.


According to Making Silicon Metal for Solar, 100000 MT of silicon metal is sufficient for the production of about 71400 MT of polysilicon and a substantial portion of OCI’s announced plans for 86000 MT of annual polysilicon production capacity by 2013.

Upstream Integration
Upstream silicon metal integration by polysilicon and silicone powerhouses Dow Corning Corporation, a 63.25% joint venture partner in the Hemlock Semiconductor Group, and Wacker Chemie AG (ETR:WCH) was covered in my Of Silicon Metal, Solar Grade, and PV-1201 and Québec Silicon Joint Venture has Solar implications posts last year. The Timminco Limited (TSE:TIM) slide below from the October 12, 2010, Analyst Day Investor presentation summarizes the earlier vertical integration trend via acquisitions and minority joint venture stakes.


At the 5th Capital Market Day presentation on May 31, 2011, Wacker was pleased the acquisition of Holla Metall had secured one third (~50000 MT) of their annual silicon metal demand just as European spot market prices climbed over €2400 per MT although the remaining two thirds of silicon metal are sourced using long term supply agreements. With around 150000 MT of annual demand for all operations, silicon metal accounts for about one third of Wacker’s top raw material costs. Wacker also mentioned capacity expansion was under review for Holla.


Per CRU Group 2011 data, the captive silicon metal capacity of Dow Corning and Wacker is 207000 and 55000 Metric Tons respectively.

Globe expands to Iceland

Western world silicon metal demand is dominated by the chemical and aluminum industries since polysilicon for the solar and electronics industries represents about 10% of the market. When announcing plans to build a 40000 MT greenfield silicon metal facility in Iceland, Globe Specialty Metals, Inc. (NASDAQ:GSM) Executive Chairman Alan Kestenbaum said:

Our decision to build this plant was driven by current and expected increased demand for silicon metal in all parts of the world caused by growth in silicones, significant growth in polysilicon, driven by the solar industry, and increased consumption of silicon metal in the aluminium industry.


Speaking of silicones, Emitter Wrap Through (EWT) technology requiring thermoplastic encapsulants could benefit Dow Corning and Wacker who both offer silicone-based thermoplastic for photovoltaic (PV) module encapsulation.

I wanted to include a silicon metal update in Photovoltaic Polysilicon Conundrum, but that post was already too long and required daily adjustments for real time PV market news. Globe Specialty Metals did not provide an update on Upgraded Metallurgical Silicon (UMG-Si) in their May 2011 Investor presentation.

Leave a Reply

Your email address will not be published. Required fields are marked *