From The Register, September 12:
US boffins say Beijing's bargain wafers are burning rivals below cost
China is moving to dominate the global market for polysilicon, a key material used in chips, by flooding the industry with cheap, subsidised product to drive producers in other countries out of business.
This is according to a report by the Information Technology and Innovation Foundation (ITIF), a think tank based in Washington D.C. It warns that Beijing is providing "significant support" to its own polysilicon industry in an effort to establish local businesses as the dominant global suppliers.
This has already led to one US supplier filing for bankruptcy, and others will follow unless countermeasures are taken, the report claims.
Polysilicon is the main substrate material used to produce the wafers that are used in nearly every semiconductor fabrication plant worldwide.
According to ITIF, manufacturers of the material rely on the sale of solar-grade (less refined) polysilicon used in solar panels in order to maintain an economy of scale required to enable their production of semiconductor-grade (more refined) polysilicon.
However, Chinese manufacturers with financial support from Beijing have ramped up production of the less refined material, establishing them as the dominant global suppliers of solar-grade gear, threatening the financial viability of polysilicon makers in the US and elsewhere.
Similar warnings were made last year about China flooding the market with cheap chips. The country's output of commodity devices from mature silicon production processes was expected to more than double within the next five to seven years, it was reported, which would lead to semiconductor firms in other countries ceasing to make them.
ITIF says in its report that China's manufacturers have continued to expand, despite operating at a loss. They have grown through facilities in Africa, India, and the Middle East, while Beijing simultaneously blocks American polysilicon exports to China.
China is understood to have an 89 percent share of the global production of solar-grade polysilicon, and the top six manufacturers by volume, such as Tongwei and GCL Technology, are all based in the Middle Kingdom....
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See also the last fifteen years of rare earth magnet supply.
