Covid-19 impact hits polysilicon manufacturers Wacker and OCI

Wacker’s integrated chemical factory in Burghausen, Bavaria
Wacker’s polysilicon plants in Burghausen (pictured) and Nünchritz have not yet returned to full utilization – Image: Wacker Chemie

Strongly reduced demand for solar-grade polysilicon due to the Covid-19 pandemic and lower prices have left their mark in the financial figures of Wacker and OCI for the second quarter.

Wacker’s polysilicon division recorded sales of €152.5 million (US$179.8 million), a decline of 17.3% from the first quarter. The EBITDA margin deteriorated from -7.4% in the prior quarter to -23.0%.

Compared to Wacker, South Korean competitor OCI has fared somewhat better. After the closure of its solar-grade polysilicon operations in Gunsan in February, OCI’s basic chemicals division achieved an EBITDA margin of -14.9% in the second quarter, down from -2.8% (excluding special effects from the plant closure) in the first quarter. As scheduled, the company resumed production of electronic-grade polysilicon in Gunsan in May.

Prospects for the third quarter look brighter as the polysilicon spot price has sharply rebounded since explosions led to the temporary shutdown of GCL’s polysilicon plant in Xinjiang on July 20.

While OCI’s solar-grade polysilicon plant in Malaysia returned to full production in mid-July after two months of maintenance works, Wacker is still closely watching the market before increasing the utilization rate of its German polysilicon plants from the current 70%. “We are very careful there,” CEO Rudolf Staudigl said in a conference call with analysts on July 30.

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