United States faces pressure from Korea to show leniency in the investigation concerning polysilicon imports
The United States is currently conducting a Section 232 investigation into polysilicon imports, focusing on China's dominance in the market and concerns about forced labor issues linked to Xinjiang supply chains, as well as subsidies that distort competition [1].
This probe, which is active as of August 2025, could lead to significant trade or tariff remedies aimed at bolstering domestic production and reducing dependency on foreign sources [1]. Korean-invested companies, including Hanwha Qcells and OCI Holdings, are importers and consumers of polysilicon, and contributors to US renewable energy and semiconductor manufacturing [2].
Hanwha Qcells primarily sources polysilicon from OCI's Malaysian production facilities [2]. OCI's US subsidiary, Mission Solar Energy, manufactures solar modules in the US using polysilicon supplied from the Malaysian plant [2].
The investigation overlaps with broader US security reviews of semiconductors and related manufacturing equipment imports, which include major East Asian suppliers such as South Korea [1]. The review aims to reduce US reliance on foreign sources, potentially imposing tariffs starting around 25%, which could affect Korean firms supplying semiconductors or components linked to polysilicon [1].
However, no specific tariffs targeting Korean polysilicon imports have been announced yet, and public comments are in process [1][3]. South Korea has requested favorable consideration for Korean companies in potential US restrictions on imported polysilicon [4].
Korea warned in its submission that restricting polysilicon imports could undermine US efforts to boost domestic production of solar panels and semiconductors, citing Korean companies involved in US solar projects [4]. The US government views China's influence in polysilicon production as a clear national security threat [1].
Industry officials have warned that such restrictions could harm even allied nations' companies operating in the US, due to limited US polysilicon production and surging US demand for power [5]. The US is considering restrictions on polysilicon imports due to an ongoing investigation into the impact of low-priced imports on the US polysilicon industry [6].
Global polysilicon prices have declined in recent years due to China's flooding of the market with state-backed, low-priced products [7]. Chinese polysilicon prices are estimated to be around $5 per kilogram, compared to $18 to $25 per kilogram for equivalent non-Chinese products [7].
In summary, the ongoing US Section 232 investigation on polysilicon imports highlights concerns about China’s market control and forced labor concerns. Policy actions could include significant tariffs or trade restrictions aimed to bolster domestic production and limit dependency. Korean companies in solar and semiconductor supply chains could face indirect impacts due to tightened US import rules and potential tariffs on polysilicon-based products and semiconductor equipment [1][3]. No final measures have been publicly imposed yet, but the government is moving with expedited review timelines typical for Section 232 investigations [3]. This situation remains fluid, with official tariffs or restrictions potentially forthcoming within months after the conclusion of the investigations and policy decision-making [1][3].
The ongoing Section 232 investigation into polysilicon imports in the United States could lead to substantial tariffs or trade remedies aimed at bolstering domestic production and reducing dependency on foreign sources, which might impact Korean companies involved in the renewable energy and semiconductor sectors. The US government views China's influence in polysilicon production as a national security threat, and although no specific tariffs targeting Korean polysilicon imports have been announced yet, the situation remains fluid, with possible tariffs or restrictions potentially forthcoming within months after the conclusion of the investigations and policy decision-making.
