The constant shortfall in supplies of polysilicon, a key raw material in the manufacture of solar cells, will dampen the fast-growing solar cell manufacturing sector this year, Merrill Lynch said yesterday.
The insufficient supply has resulted from a spike in demand for alternative energy amid rocketing oil prices over the past year, analysts said.
"The shortage is real," Brett Hodess, a senior analyst who tracks semiconductor capital equipment for Merrill Lynch, told reporters at a press conference wrapping up the research house's annual tech forum in Taipei.
Demand for polysilicon has increased 30 percent annually, but supply has only expanded by 10 percent, and the imbalance has been reflected in price hikes, he said. The price of polysilicon has jumped almost 30 percent to between US$80 and US$90 a kilogram, compared with between US$50 and US$60 last year, he said.
The price could rise even higher to around US$100 on some spot markets, he said.
"The shortage will slow solar cell makers rather than semiconductor companies," Hodess said.
Polysilicon accounts for a higher percentage of cost per wafer for solar-cell makers -- at between 35 percent and 40 percent -- compared with around 10 percent for chipmakers, he said.
Previously, industry analysts projected growth for solar cell makers would be around 30 percent annually; now they have lowered the forecast to around 10 percent, due to a shortage in the raw material, Hodess said.
Taiwan's top solar cell maker Motech Industries Inc (
Motech shares have rocketed 62 percent since the beginning of the year, and stood at NT$785 (US$24.1) yesterday on the nation's over-the-counter market, or GRETAI Securities Market.
Hodess did not expect any quick solution for the shortage.
"We believe polysilicon supplies will stay tight, or remain in short supply for at least another two years and possibly through 2008," he said.
That would send prices for already expensive polysilicon up by another 25 percent to 30 percent annually during this year and next, Hodess predicted.
He blamed slow capacity expansion and the high threshold for new players for the insufficient supply.
The major players in the polysilicon industry have announced increasing investment in polysilicon plants, but it takes at least two-and-a-half years to ramp up production in a factory, Hodess said.
On top of that, no new players have appeared on the landscape as patent issues and massive investment costs have discouraged interested parties from entering the market, he said.
The domestic unit of the Chinese-owned, Dutch-headquartered chipmaker Nexperia BV will soon be able to produce semiconductors locally within China, according to two company sources. Nexperia is at the center of a global tug-of-war over critical semiconductor technology, with a Dutch court in February ordering a probe into alleged mismanagement at the company. The geopolitical tussle has disrupted supply chains, with some carmakers reportedly forced to cut production due to chip shortages. Local production would allow Nexperia’s domestic arm, Nexperia Semiconductors (China) Ltd (安世半導體中國), to bypass restrictions in place since October on the supply of silicon wafers — etched with tiny components to
Singapore-based ride-hailing and delivery giant Grab Holdings Ltd has applied for regulatory approval to acquire the Taiwan operations of Germany-based Delivery Hero SE's Foodpanda in a deal valued at about US$600 million. Grab submitted the filing to the Fair Trade Commission on Friday last week, with the transaction subject to regulatory review and approval, the company said in a statement yesterday. Its independent governance structure would help foster a healthy and competitive market in Taiwan if the deal is approved, Grab said. Grab, which is listed on the NASDAQ, said in the filing that US-based Uber Technologies Inc holds about 13 percent of
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday received government approval to deploy its advanced 3-nanometer (3nm) process at its second fab currently under construction in Japan, the Ministry of Economic Affairs said in a news release. The ministry green-lit the plan for the facility in Kumamoto, which is scheduled to start installing equipment and come online in 2028 with a monthly production capacity of 15,000 12-inch wafers, the ministry said. The Department of Investment Review in June 2024 authorized a US$5.26 billion investment for the facility, slated to manufacture 6- to 12nm chips, significantly less advanced than 3nm process. At a meeting with
Taiwan is open to joining a global liquefied natural gas (LNG) program if one is created, but on the condition that countries provide delivery even in a scenario where there is a conflict with China, an energy department official said yesterday. While Taiwan’s priority is to have enough LNG at home, the nation is open to exploring potential strategic reserves in other countries such as Japan or South Korea, Energy Administration Deputy Director-General Chen Chung-hsien (陳崇憲) said. While the LNG market does not have a global reserve for emergencies like that of oil, the concept has been raised a few times —
RSS