The U.S. Customs and Border Protection (CBP) issued a Withhold Release Order on Thursday on silicon-based products made by Hoshine Silicon Industry Co. The Chinese company is located in the Xinjiang province, an area under global concern for forced labor practices. The Biden Administration issued the ban as a reaction to discussions at the G7 Summit in the UK earlier this month, where country leaders united to stand against products using forced labor entering the global supply chain.
Hoshine produces industrial silicon used in automotive and electronic products, as well as a small amount of polysilicon products that would be relevant to the solar industry. The company mostly distributes its silicon domestically, and Reuters reported the impact of this U.S. import ban would be “limited.” This initial ban likely will not affect the solar industry as a whole, but it alludes to future, more widespread bans on polysilicon-related products coming from the Xinjiang region.
Around 80% of the world’s polysilicon supply comes from China, with nearly half coming out of the Xinjiang province.
CBP has been investigating allegations of forced labor within the U.S. supply chain and has issued bans on other Xinjiang-produced products, including cotton, tomatoes and seafood. The United States, and many other international democracies, believe that China is forcing those in the mostly Muslim Uyghur population into labor camps in the Northwest portion of the country. The situation is being described as an ethnic and religious genocide of the Uyghur people.
“The People’s Republic of China’s forced labor practices run counter to our values as a nation and expose American consumers to unethical practices. They also leave American businesses and workers to compete on an uneven playing field by allowing firms to gain advantage over their competitors by exploiting workers and artificially suppressing wages,” the White House said in a statement. “The United States will not tolerate forced labor in our supply chains and will continue to stand up for our values and for U.S. workers and businesses.”
In addition to the Hoshine product import ban, the Dept. of Commerce has added Hoshine and four other silicon producers from Xinjiang to its entity list, which would prevent U.S. companies from working with them or selling them products. Those companies include: Daqo New Energy; East Hope Nonferrous Metals; GCL New Energy Material Technology, and Xinjiang Production and Construction Corps (XPCC).
Daqo, East Hope and GCL were listed in the Top 6 polysilicon manufacturers of 2020, and the expectation is that these three companies along with Tongwei (Chinese firm in the Sichuan Province) will be the Top 4 polysilicon producers by 2022.
In December 2020, advocacy group SEIA asked solar companies to sign a pledge against using forced labor in the solar supply chain. The group plans to develop a supply chain traceability protocol for materials used in solar modules to help companies track from where their products are coming.
“Unethical labor practices run against everything we stand for as an industry and are counter to our values,” said Abigail Ross Hopper, president and CEO of SEIA. “It’s on us to be vigilant and take steps to ensure the solar industry is free of forced labor practices. Dozens of companies have already stepped up to sign our pledge and we’re calling on the entire industry to join us.”