May 25, 2009 / 5:02 PM / 10 years ago

REC cuts solar wafer production by 35 percent

OSLO (Reuters) - Norway’s solar energy equipment maker Renewable Energy Corporation said on Monday it was temporarily cutting 35 percent of its solar wafer capacity due to challenging markets and low visibility.

The production cuts will affect 180 REC employees. REC said it was not prepared to update production or financial guidance of its wafer unit because timing of the restart was unclear.

“We have seen an increasingly difficult market so far this year and need to take measures to optimize our capacity utilization and secure flexibility in regards to timing of product deliveries,” Ingelise Arntsen, Executive Vice President for the wafer unit, said in a statement.

The company said it would be ready to increase production at short notice when market conditions changed.

REC said that continued wafer production at full capacity would have required external purchases of polysilicon, the metal used to make solar wafers, at “spot prices that are higher than the price levels in the long-term polysilicon supply contracts.”

REC repeated that its polysilicon production was expected to rise when production from the expansion of its flagship plant at Moses Lake, Washington, resumes in the third quarter 2009.

Shares in REC were down 5.7 percent at 71.50 crowns at 1443 GMT, while Oslo’s benchmark index was up 0.5 percent.

Reporting by Oslo newsroom, editing by Will Waterman

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