Wacker Jumps on Polysilicon Price, UBS Upgrade: Frankfurt Mover

Wacker Chemie AG, a German maker of polysilicon used in solar panels, rose to the highest in more than three months after prices of the material gained and UBS added it to its list of most preferred European chemical stocks.

Wacker advanced as much as 7 percent to 54.43 euros, its highest intraday value since Sept. 18. The price of polysilicon climbed to $15.38 per kilo from $15.35, its first weekly increase in 11 months, SK Securities Co. said in a report today, citing data from research firm PV Insights. The price had been falling due to oversupply.

“While the increase is marginal, I think it’s worth noting because this could be an indicator of the future price direction,” Sohn Ji Woo, an SK Securities analyst, wrote in the report.

Polysilicon makers such as Wacker and GCL-Poly Energy Holdings Ltd. raised output in 2011, producing more than needed by solar-panel developers and creating a glut that sent prices below output costs for most manufacturers. The overcapacity has hurt margins at solar-cell and panel makers as governments across Europe scaled back support for the industry.

Market optimism can be found in Germany, where unabated growth in solar installations despite subsidy cuts should cause fourth-quarter results to be “less terrible” than previously expected, Jenny Chase, an analyst with Bloomberg New Energy Finance, said by phone. Warren Buffett’s MidAmerican Energy Holdings Co. is also spending as much as $2.5 billion in the secondary market for solar power projects, she said.

“While demand may well be slightly up over the year, we expect the polysilicon price to come back to $20 to $25 by the end of 2013 only if there’s consolidation in the market,” Chase said.

Wacker was up 5 percent at 53.40 euros at 11:52 a.m. in Frankfurt. OCI Co., South Korea’s biggest maker of polysilicon, rallied the most in eight months in Seoul. GCL-Poly rose 6.8 percent at the close in Hong Kong.

Before it's here, it's on the Bloomberg Terminal.