China’s Top Polysilicon Producers Band Together to Tackle Overcapacity, Steady Prices(Yicai) Dec. 10 -- Nine leading Chinese producers of solar‑grade polysilicon, including Tongwei Group and GCL Group Holdings, have formed a joint venture to cut outdated production capacity in an industry plagued by aggressive price competition and losses.
The new venture aims to unlock collaboration among photovoltaic companies, driving technology upgrades, market expansion, and cost and capacity rationalization, according to an informed source.
Guanghe Qiancheng Technology, the Beijing-based JV, has a registered capital of CNY3 billion (USD425 million). It was set up by the nine companies and an entity wholly owned by the China Photovoltaic Industry Association. Tongwei and GCL own nearly half of the equity.
Solar polysilicon prices rose to a record high in August 2022 and then slumped as new production capacity came on stream. That led to overcapacity, sparking a fierce price war. At its lowest point this July, the price was down nearly 90 percent from peak.
Following news of the new JV, polysilicon spot prices began to recover. The spot price reached CNY52,000 (USD7,362) per ton on Dec. 8, up about 50 percent from a multi-year low of around CNY34,700 in July.
China’s solar industry is pushing efforts to rationalise supply and demand by shuttering outdated capacity in an orderly manner, a move intended to end vicious competition, Liu Yiyang, executive secretary-general of the CPIA, wrote last month.
The JV’s legal representative will be Hou Yicong, founder of Chunquan Capital, according to corporate information provider Qichacha. Hou worked at ShineWing Certified Public Accountants for seven years as a project manager and was responsible for post-investment management at IDG Capital and JD Capital.
Tongwei indirectly holds a 30.35 percent stake in the JV, and GCL has 16.79 percent, while East Hope, Daqo Energy, Xinte Energy, and Asia Silicon Qinghai each own between 7.79 percent and 11.3 percent. The other three businesses and the CPIA subsidiary each have a relatively low stake.
Editors: Tang Shihua, Tom Litting
