OCI considers shifting polysilicon capacity from Korea to Malaysia

The prospect of rising electricity prices has prompted polysilicon manufacturer OCI to consider shifting production capacity from its South Korean plant in Gunsan (current capacity: 52,000 metric tons) to its subsidiary in Malaysia (27,000 metric tons), The Korea Times reports.

Raising the industrial electricity rates was one of the election pledges of President Moon Jae-in, who came into office in May 2017 after the impeachment of Park Geun-hye. “The government is moving to increase the cost again,” OCI Vice Chairman Lee Woo-hyun told reporters after the general meeting of shareholders on March 26. “It is necessary to consider moving to Malaysia after shutting down factories in Korea.”

Lee added: “The Malaysian government provides factory sites for free, and the country’s electricity costs are one third cheaper than those in Korea.”

OCI’s considerations resemble recent complaints of polysilicon manufacturer Wacker about rising electricity prices in Germany. Both companies are under pressure from Chinese competitors, which benefit from very low, subsidized electricity rates, in particular in China’s western provinces.