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GCL-Poly, OCI Plunge as Germany Accelerates Solar-Rate Cuts

Jan. 20 (Bloomberg) -- GCL-Poly Energy Holdings, Asia’s second-biggest maker of polysilicon used in solar panels, fell the most in more than a month after Germany said it will accelerate subsidy cuts to slow demand for the modules.

The Hong Kong-based supplier was the third-biggest loser on the Hang Seng Composite Index, declining 5.6 percent to HK$2.54 as of 1:40 p.m. local time. Seoul-based OCI Co., Asia’s biggest polysilicon maker, was down 2 percent after falling as much as 4.1 percent on the Korea Exchange.

The polysilicon makers joined Suntech Power Holdings Co. and LDK Solar Co., the biggest solar panel-makers, which declined in overnight U.S. trading. Germany, the world’s largest market for sun-based power, announced it will start reducing the preferential rates paid to solar utilities on a monthly basis instead of twice annually to slow installations and spiraling subsidy costs.

A solar supply glut could mean many polysilicon producers will either operate at a loss until cash runs out or close their plants, Brett Prior, an analyst at GTM Research, said in a report yesterday.

To contact the reporter on this story: Natalie Obiko Pearson in Mumbai at npearson7@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

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