Interview: USP’s Polysilicon Project Goes Live in Oman, Eyes US and India Markets
Oman-based United Solar Polysilicon or USP plans to commission its new 100,000 metric tons per year solar polysilicon facility in the country in two phases, Ben Jia, USP’s sales director, said in an interview with OPIS at the plant’s groundbreaking ceremony on Thursday. The project will initially operate at 50,000 mt/year in its first phase, while the remaining 50,000 mt/year in the second phase is tentatively scheduled to begin production in the early part of the second half of this year.
Jia added that the plant’s monthly output is expected to reach approximately 2,000 mt in March, increase to around 4,000 mt in April, and stabilize at that level thereafter. This would correspond to an annualized output of 50,000 mt, consistent with the first-phase capacity target.
He noted that the company is adopting a prudent yet optimistic approach in assessing market conditions, and that the timing of the second-phase ramp-up will ultimately depend on continued market observations. He added that annual polysilicon demand from the U.S. end-user solar market is estimated at approximately 80,000 mt, while aggregate capacity among non-Chinese polysilicon producers already significantly exceeds this level.
Although USP’s manufacturing costs are lower than those of other non-Chinese polysilicon producers— potentially allowing for relatively competitive pricing—Jia said that USP does not intend to compete through aggressive price undercutting. Instead, the company aims to avoid mutually destructive outcomes or major market disruptions, considerations that are central to its deliberations on the timing and scale of second-phase production.”
Total Investment to Reach Nearly $1.7 billion
USP’s polysilicon project in Oman—currently the largest single-site facility by nominal capacity in the non-Chinese market—was officially launched in March 2024 and formally commenced production on Thursday after nearly two years of construction.
Speaking at the groundbreaking ceremony, company Chairman Zhang Longgen stated that total investment in the project is expected to reach nearly $1.7 billion. He said that the project’s value extends beyond its production scale and capital expenditure, highlighting its broader strategic significance to the global photovoltaic supply chain.
Also speaking at the event, Chris MacDonald, managing director of USP’s partner Awendio Solaris, said that as the first polysilicon manufacturing facility in the Middle East, the project provides the industry with a meaningful and practical alternative source of supply. By delivering high-purity, traceable polysilicon at competitive cost levels, the project is expected to contribute to a more balanced and resilient global supply chain amid intensifying geopolitical and trade uncertainties.
Current Status and Future Plans
“Like other non-Chinese polysilicon producers, we have established a standardized product naming system that reflects key characteristics such as N-type suitability, monocrystalline application and product size,” Jia said.
Currently, five to six customers have placed trial orders. Jia noted that the company’s primary focus in March will be executing these trial shipments, delivering products and collecting customer feedback. Such feedback extends beyond product quality to include a range of operational, logistical and commercial considerations that require careful, case-by-case engagement, he added.
Jia observed that while strict long-term agreements—characterized by fixed purchase volumes, extended contract durations and formula-based pricing—were common in earlier non-Chinese polysilicon business models, future long-term contracts are likely to become more conditional rather than fully binding. This shift reflects heightened geopolitical and trade uncertainties, prompting customers to adopt a more cautious approach. “We understand this and are prepared,” Jia said.
He noted that many customers continue to recognize the opportunities offered by USP’s polysilicon, particularly in supporting downstream manufacturing, enhancing supply chain diversification and traceability, and facilitating smoother international trade flows. Jia added that USP currently has the lowest production costs among non-Chinese polysilicon producers, alongside relative geopolitical advantages, and expressed confidence in the company’s product quality.
Chairman Zhang’s remarks at the ceremony reinforced Jia’s assessment of cost competitiveness. Zhang stated that USP is working closely with the Omani government and state-owned mining company Mineral Development Oman to jointly develop a metallurgical silicon project with an annual capacity of 150,000 mt. This initiative is intended to secure a stable raw material supply for polysilicon production while further reducing costs.
In parallel, USP is cooperating with OQ Alternative Energy, an Omani government-owned global renewable energy investment company, to develop a 700 megawatt solar power plant. The project will supply green electricity to support sustainable polysilicon production and is expected to reduce electricity costs by approximately $0.005/kWh.
In addition, Zhang revealed that a 400-acre land parcel has already been reserved at the current site for the potential construction of 6.6 gigawatts of wafer capacity and 3 GW of cell capacity. This integrated layout is intended to ensure that the full value chain remains compliant with U.S. Foreign Entity of Concern requirements, enabling downstream products to access the U.S. market without disruption.
Jia added that with these supporting projects in progress, the wafer manufacturing project is currently the most advanced in terms of readiness and feasibility, although a definitive implementation timeline has yet to be determined.
Expectations for the U.S. Market
Trade flows and sales prospects for USP’s polysilicon—particularly with respect to the U.S. market— remain a focal point for industry participants.
In the near term, USP’s primary objective is to enable customers using its polysilicon to access the U.S. market smoothly with their downstream products, according to Jia. He acknowledged that this objective faces challenges amid rising international trade tensions, but noted that the evolving landscape also presents opportunities to broaden the company’s customer base.
Jia highlighted the ongoing U.S. Section 232 national security investigation into imports of polysilicon and its derivatives, emphasizing its potential implications for pricing dynamics in the non-Chinese polysilicon market. He opined that decisions regarding whether to impose tariffs, the level of such tariffs, and the allocation of any tariff-free quotas reflect a broader conflict of interest between U.S. upstream polysilicon producers and downstream end users, rather than competition among global polysilicon suppliers alone.
Drawing on historical precedent, Jia noted that the U.S. has launched dozens of Section 232 investigations across various products, yet only a limited number have ultimately resulted in tariff increases—and where imposed, tariff levels have generally remained manageable. He added that U.S. authorities are likely to consider the broader market impact and avoid measures that could drive solar system prices sharply higher. “As long as tariffs are not excessively high, our cost advantage in polysilicon manufacturing should allow us to remain competitive,” Jia said.
Industry perspectives partly support Jia’s assessment, while also reflecting caution. Johannes Bernreuter, founder and head of Germany-based Bernreuter Research, expressed reservations regarding USP’s prospects in the U.S. market. He noted that, given U.S. opposition to a loan from the International Finance Corporation to USP, it remains uncertain whether polysilicon processed into solar modules would be able to enter the U.S. market without tariffs, or only under a tariff regime.
Despite these uncertainties, USP continues to explore the U.S. market. As Zhang stated at the ceremony, the company’s strategy extends beyond building a localized solar supply chain in Oman. It plans to establish 2 GW of wafer and 2 GW of solar cell capacity in the U.S., with the longer-term goal of developing an integrated manufacturing platform encompassing 5 GW of wafers, cells, and modules. To support these initiatives, the company is also actively pursuing a U.S. listing to secure long-term financial backing.
Outlook for Other Markets
Beyond the U.S., Jia identified regions that are actively developing domestic solar manufacturing value chains but still lack upstream capacity as key target markets for USP’s polysilicon. India was cited as a prime example. He added that the use of USP’s polysilicon could also help Indian downstream products mitigate trade-related risks when exporting to the U.S.
Over the longer term, Jia emphasized that supplying the local end-user market in the Middle East is also a strategic objective. While the region currently imposes no restrictions on solar product imports, governments there strongly back the localization of solar manufacturing. As a result, import-related measures such as tariffs could emerge over time, supporting broader downstream utilization of USP’s polysilicon capacity within the region.
“Our polysilicon production costs are higher than those in China, but remain within a manageable range,” Jia said. He added that even relatively modest import tariffs of 10%–15% on solar products in the Middle East would significantly enhance the local competitiveness of USP’s products.
When asked whether recent policy adjustments and price volatility in China’s solar market could affect USP at its current stage, Jia downplayed the potential impact, noting that the two markets operate under fundamentally different dynamics and therefore exhibit limited correlation. He added that USP would only consider supplying the Chinese market if excess polysilicon capacity in China were substantially reduced and prices rose sustainably to levels closer to USP’s production costs, a scenario he does not expect to materialize in the near term.
Bernreuter suggested that USP’s impact may be more visible in China’s polysilicon export markets initially. He noted that amid global trade uncertainties, India—which is seeking to reduce its reliance on Chinese imports—represents the most tangible market opportunity for USP. If successful, this strategy could position USP as a direct competitor to Chinese polysilicon suppliers, potentially reducing Chinese exports to India.
Bernreuter added that, in the short term, the ramp-up of USP’s polysilicon production may exert some pressure on non-Chinese polysilicon prices, though the impact is likely to be limited. Over the longer term, however, the implementation of the EU’s traceability regulations in December 2027 could meaningfully alter market dynamics, potentially creating broader opportunities for USP.
—Reporting by Summer Zhang, szhang@opisnet.com; Editing by Mei-Hwen Wong, mwong@opisnet.com