Solar Silicon Price Plunge: Rising Concerns for the Korean Solar Industry

The Korean solar industry is facing a serious threat due to the sharp decline in the price of Chinese low-cost polysilicon. According to a report by Hankyung, increased domestic production and oversupply in China are causing significant damage to domestic polysilicon manufacturers, potentially leading to a decline in the profitability of the entire solar industry. This situation has the potential to weaken the competitiveness of the Korean solar industry and dampen investor sentiment.

Rapid Volatility in the Solar Silicon Market

The solar silicon market has recently experienced extreme volatility. Due to increased production capacity in China and oversupply from some companies, prices have plummeted. This is affecting the global solar industry and is particularly serious for countries like Korea, which rely on polysilicon production.

Analysis of the Causes of the Decline in Chinese Polysilicon Prices

The main reasons for the decline in Chinese polysilicon prices are as follows:

• Increased Production: Increased production capacity in China has been boosted by the government’s active support policies and investments.


• Oversupply: Some companies maintained excessive production levels without anticipating market conditions, leading to oversupply.


• Decreased Demand: With the slowdown in the global solar market, demand for polysilicon has decreased.

Threats to the Korean Solar Industry

The Korean solar industry is facing the following threats due to the decline in Chinese polysilicon prices:

Profitability Decline:

A decline in polysilicon prices can significantly worsen the profitability of domestic manufacturers. Particularly, companies with low price competitiveness are threatened with survival.

Weakened Competitiveness:

The price competitiveness of Chinese polysilicon weakens the competitiveness of Korean companies and can lead to a loss of market share in the global market.

Dampened Investor Sentiment:

Concerns about the crisis in the solar industry are leading to a dampening of investor sentiment, which can hinder new investment and industrial growth.

Future Outlook and Response Strategies

The situation in the solar silicon market is expected to worsen in the short term, but has the potential to recover in the long term through supply chain restructuring and technological innovation. The Korean solar industry must overcome the crisis through the following response strategies:

Strengthening Technological Competitiveness

It is necessary to strengthen technological competitiveness such as high-purity polysilicon production technology and solar module efficiency improvement technology to differentiate from Chinese products.

Diversifying Export Markets

Reduce dependence on China and develop various export markets such as Europe and North America.

Expanding Government Support

Expand government support for the strengthening of the competitiveness of the Korean solar industry, such as technology development and overseas market entry.