The United States has imposed a 15% tariff and new price floors on products made from polysilicon. This raw material is crucial for semiconductors and solar panels, with China being the primary producer. These measures, announced by US President Donald Trump, aim to support domestic chip and solar supply chains.
The actions fall under Section 232 of the Trade Expansion Act of 1962. They are designed to enhance US competitiveness against Beijing in artificial intelligence and energy sectors. The White House stated these steps will ensure the commercial viability of US polysilicon production, meeting economic and national security needs.
Polysilicon, an ultra-pure form of silicon, forms the base of semiconductor and solar manufacturing. Manufacturers convert silicon wafers into solar cells, then assemble these into panels for solar projects. This move reflects a broader US strategy to reduce reliance on foreign supply chains, particularly from China.
American solar factories have long accused Chinese rivals of unfair practices. These include dumping solar panels, receiving government subsidies, and relocating manufacturing to avoid US tariffs. The new tariffs address these long-standing grievances within the industry.
The United States currently has two polysilicon factories. Hemlock Semiconductor operates a plant in Michigan, a joint venture between Corning and Japan's Shin-Etsu Handotai. Munich-based Wacker Chemie runs another factory in Tennessee. These domestic producers are expected to benefit significantly from the new protections.
A Corning spokesperson stated that the decision encourages continued investment in US capacity. It also supports long-term US competitiveness in the sector. Wacker Chemie is reviewing the actions to understand their full impact, acknowledging the importance for semiconductor supply chain resilience.
Domestic semiconductor manufacturing relies on the solar industry's demand for polysilicon. The larger demand from solar helps sustain the production of material needed for chips. The chip industry accounts for 2.4% of global polysilicon demand, according to the Semiconductor Industry Association.
US solar manufacturing has expanded since Congress introduced tax incentives in 2022. However, much of this growth has focused on panel assembly, leaving manufacturers dependent on imported wafers and cells. These components require longer investment timelines for domestic production.
Companies with US solar factories, including T1 Energy, First Solar, and Qcells, have applauded Trump's decision. Dan Barcelo, CEO of T1 Energy, called it a decisive win for advanced American manufacturing. T1 Energy is investing GHS 510 million in a cell factory in addition to its Texas solar panel plant.
The trade protections will become effective on December 4. Tim Brightbill, a trade attorney with Wiley Rein, warned that this delayed implementation could lead to a surge of imports in the coming months. Companies that purchase solar panels have argued that the delay is necessary to adjust supply contracts to potentially higher prices.
The White House document specifies minimum import prices: GHS 21 per kilogram for polysilicon, GHS 100 per kilogram for polysilicon ingots and wafers, GHS 0.22 per watt for solar cells, and GHS 0.38 per watt for solar modules or panels. The proclamation also authorizes the Commerce Department to create an incentive program for companies investing in polysilicon production facilities.