Daqo is targeting polysilicon production costs of $6.80/kg by 2020

China-based polysilicon manufacturer Daqo New Energy is targeting total production costs of US$6.80/kg by the first quarter of 2020, down from $9.05/kg in Q2 2018 and $7.50/kg projected for 2019.

Cash costs would then approach approx. $5.50/kg. The company will benefit from economies of scale, more efficient production as well as a lower electricity rate.

Daqo expects to ramp up its new Phase 3B facility with an annual capacity of 12,000 metric tons (MT) by the end of Q1 2019, bringing the total nominal capacity of its plant in Shihezi, Xinjiang to 30,000 MT; effectively, it is closer to 35,000 MT. 80% of the output will then be applicable for monocrystalline wafers.

Daqo is also planning to increase the capacity by another 5,000 MT through debottlenecking by the end of June 2019.

Construction of Phase 4A has already begun; its capacity of 35,000 MT will expand the total capacity to 75,000 MT. Ramp-up is expected to start in Q4 2019 and to be completed in Q1 2020.

The electricity rate for Daqo’s plant will drop from RMB0.29 incl. VAT (US$0.042) per kWh currently to RMB0.24 (US$0.035) after the ramp-up of Phase 3B, and to RMB0.20 (US$0.029) after ramp-up of Phase 4A.