UPDATE 1-Q-Cells gets solar wafer supply deal with LDK Solar
FRANKFURT, Dec 10 (Reuters) - German solar cell maker Q-Cells AG (QCEG.DE) agreed a 10-year supply deal for solar wafers with LDK Solar Co Ltd (LDK.N), setting the stage for future expansion, the company said on Monday.
The contract runs from 2009 to 2018 and will enable Q-Cells to manufacture cells with an overall output of more than 6 gigawatt peak (GWp) in addition to current expansion plans, it said.
The world's second largest solar cell maker after Japan's Sharp Solar (6753.T) is expanding rapidly and aims to reach an output in its core business of 1 GWp by 2010 from 370 Megawatt peak (MWp) at the end of this year.
Growth in the industry has been capped by shortages in the supply of silicon, the key ingredient for solar wafers, out of which solar cells are made.
LDK, a manufacturer of solar wafers, will use silicon from its own polysilicon plant which is being built as well as silicon from other supply sources, it said.
While parts of the pricing of the wafers will be fixed for 2009 and 2010, the fixed pricing element can be adjusted to market conditions thereafter, Q-Cells said.
In addition, Q-Cells has an option to purchase 30 percent of LDK's additional silicon production if LDK expands its production capacity.
Q-Cells shares were indicated 1.9 percent higher, according to pre-market data from brokers by 0713 GMT, while the overall market .GDAXI was seen 0.5 percent lower. (Reporting by Eva Kuehnen; Editing by David Holmes)
