(Getty Images)
(Getty Images)

South Korea has formally asked the United States to grant favorable consideration to Korean companies as Washington weighs potential restrictions on imported polysilicon, a key material used in solar panels and semiconductors.

According to a document posted Friday by the US Bureau of Industry and Security, Korea’s Ministry of Trade, Industry and Energy urged the US to adopt a flexible approach toward Korean firms during its ongoing investigation into the impact of low-priced imports on the US polysilicon industry.

“Korea is a net importer of high-quality polysilicon from the United States. At the same time, Korea and its companies have established a secure supply chain for polysilicon to US importers and US companies,” the ministry wrote.

“If import restrictions on polysilicon are introduced, we respectfully request that special consideration be given to allow for flexible application to Korean companies.”

The investigation, launched July 1 under Section 232 of the US Trade Expansion Act of 1962, examines national security concerns related to imported goods. US officials have warned that low-cost polysilicon imports are forcing domestic plants to shut down.

Global polysilicon prices have declined in recent years as China — which now accounts for nearly 80 percent of global supply — has flooded the market with state-backed, low-priced products. IBK Securities estimates Chinese polysilicon prices at around $5 per kilogram, compared with $18 to $25 per kilogram for equivalent non-Chinese products.

In its submission, Korea warned that restricting polysilicon imports could undermine US efforts to boost domestic production of solar panels and semiconductors. It cited Korean companies, including Hanwha Qcells and OCI Holdings, that are involved in US solar projects.

“Korean-invested companies that are helping to grow US renewable energy and semiconductor manufacturing are importers of polysilicon, as well as consumers of US-produced polysilicon,” the ministry said.

“Broadly applied tariffs or other import restrictions on polysilicon risk disrupting supply chains that are important to both economic and national security.”

Hanwha Qcells and OCI Holdings also filed separate statements to the bureau, stressing that their supply chains do not use low-cost Chinese polysilicon.

Currently, Hanwha Qcells mainly sources polysilicon from OCI’s Malaysian production facilities. Additionally, OCI’s US subsidiary, Mission Solar Energy, manufactures solar modules in the US using polysilicon supplied from the Malaysian plant.

Industry officials warned that sweeping restrictions could harm even allied nations’ companies operating in the US.

“US polysilicon production is currently limited, while US demand for power is surging,” one industry source said. “If broad import restrictions are implemented in this environment, even companies from allied nations that are building supply chains and investing in US manufacturing could face indirect damage.”


forestjs@heraldcorp.com