CHINESE SILICON PROBLEMS

Due to the problems with energy in China, silicon manufacturers have had to reduce production. Making a bolus from a pool of liquid silicon is energy intensive.

Production of high-purity silicon was greatly reduced as a result of the energy restrictions, to the point where some companies outside of China have had to halt their operations until they can secure a stable supply. It’s expected that glass, solar panel, and car makers will see the rippling effects of this in the coming months, and manufacturers of silicone-based products are already feeling the hit on their business.

Qinshan Nuclear Power Plant

To get an idea of the severity of this issue, for the past two decades, the price of silicon has mostly hovered in the 8,000 to 17,000 yuan ($1,200 to $2,600) range per ton. Now that Chinese silicon suppliers in the Yunnan province have reduced their output by 90 percent compared to August levels, the prices have surged to as high as 67,300 yuan ($9,880) per ton.

Industry insiders believe silicon prices will remain high until at least mid-2022, when production will ramp up again. In the meantime, some manufacturers will be able to absorb the shock, while many will likely increase the price for end customers.

Nuclear power contributed 4.9% of the total Chinese electricity production in 2019, with 348.1 TWh. This is an increase of 18.1% from 2018; two new reactors came online in 2019. China has been expanding nuclear power which will reduce its dependency on coal longer term.

The Qinshan Nuclear Power Plant is a typical facility which is based on a Canadian design.

China slowed its construction after the Japanese disaster but demand for power is so great that regulators are moving faster to make sure risks are manageable.

US and Canada need to resume nuclear construction to provide enough power for future needs. Wind and solar are fine but a few well placed reactors can handle the peak demands more radially.