ROTH: US Customs detained solar module shipments under law on forced labor

US Customs and Border Patrol has detained a large shipment of quartzite, a raw material for making polysilicon, from an unnamed Tier 1 solar module supplier.

From pv magazine USA

According to a recent industry note from ROTH Capital Partners Managing Director Phil Shen, US Customs and Border Patrol (CBP) has detained a large shipment of materials from an unnamed Tier 1 solar module supplier.

Shen said a shipment of quartzite, a raw material in polysilicon production, was seized as part of the enforcement of the recently-enacted Uyghur Forced Labor Prevention Act (UFLPA) ROTH said that CBP has demanded documentation showing the source of the quartzite.

The issue of quartzite documentation is an especially tricky one. ROTH said that none of the module vendors appear to have quartzite documentation, and noted that two of the leading suppliers, Wacker and Hemlock Semiconductor, are not in a position to provide such information. It is possible that it is information the companies could provide, said Roth, but doing so would take time and put other shipments to the United States in jeopardy.

Passed in December 2021, the UFLPA seeks to ban imports of all products from China’s Xinjiang region unless the products are not be connected to forced labor. Xinjiang is home to 50% of the global supply of polysilicon, which is an essential material in conventional solar modules. And there are concerns that implementation of the UFLPA would severely disrupt what has already become a strained solar supply chain.

While roughly half of the world’s polysilicon does not come from Xinjiang, it is difficult to trace where every single manufacturer gets all of their polysilicon from. There could also be potential for entire factories to be “contaminated” by a relatively small mix of Chinese polysilicon in an otherwise non-Chinese mix.

The US Department of Homeland Security’s June 30 strategy to prevent the importation of goods mined or produced using forced labor under the UFLPA was initially seen as a best-case scenario for the solar industry. But with other at-risk  companies left off the list of banned imports, this detention casts a shadow on that notion.

This post appeared first on PV Magazine.

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