Kris Guns, CEO of Fortis Metals, who was speaking at the MMTA in Hong Kong on November 6th predicted the Tellurium market will face a deficit in 2020. “Analyzing minor metals supply in the solar industry, our company has done an extended market research and we have come to the conclusion that the Tellurium deficit as of 2020 could be as big as a staggering 370 metric ton.” Main driver of the increased Tellurium consumption is the growth in the Cadmium Telluride photovoltaic market. By 2020 First Solar, the world leader in in CdTe solar panels is planning to increase its annual production to 7.6GW. Only this year they have commissioned new plants in Ohio, Malaysia and Vietnam. During the following 2 years, 2 more factories will start producing in Ohio and Vietnam. In addition to First Solar, Chinese manufacturers like CNBM Optoelectronics are making impressive progress. In the next years they are expected to ramp up production to 1GW.
Tellurium consumption per GW of CdTe PV production is estimated at 91 metric ton. This means that by the end of 2020, 782 metric ton of Tellurium will be consumed only for solar panels. This is a massive number in a market which is typically is not able to increase production as demand is growing. “Tellurium is produced as a by-product of mainly Copper and Lead. This means worldwide production is more or less stable. Unlike most metals, it is nearly impossible to ramp up production to benefit from increasing demand.” Worldwide production of Tellurium is estimated at 835 metric ton per year. Non-solar consumption (mainly in Bismuth Telluride thermoelements) is roughly at 420 metric ton. This puts the future deficit at 370 metric ton. “At the moment, we are still seeing inventories in China but these are being eaten away by the two main suppliers of First Solar. It is only a matter of time before the market will understand the new dynamics and prices will start to reflect the growing deficit.”, according to Kris Guns. “In 2011 when First Solar was only at 2.4GW capacity, Tellurium spiked at $350/kg. It seems inevitable that a worldwide CdTe production of 8.6GW will have a significant impact. We would not be surprised to see prices break the previous record seen in 2011.”