General Sector-Specific Conditions

We expect that the positive business trends in WACKER-relevant industries will continue during 2011.

Semiconductor-Wafer Demand to Increase in 2011

According to Gartner, a market research institute, the semiconductor market will expand in 2011. Worldwide silicon-wafer sales by surface area sold will rise 4.0 percent year on year to around 65,200 million cm². In terms of wafer sizes, 300 mm sales volumes will increase faster than small and mid-sized diameters. Similarly, we anticipate stronger wafer demand, especially in the 300 mm sector. For 2012, Gartner forecasts further sales growth of over 7 percent.

Photovoltaic Market Continues to Expand

The EPIA (European Photovoltaic Industry Association) predicts further photovoltaic-market growth for the coming years. 2011 will see newly installed, photovoltaic (PV) capacity of 15.4 gigawatts (GW) worldwide, the same high level as last year. In Germany, however, newly installed capacity is expected to fall in 2011, mainly because its feed-in tariffs were cut by 13 percent on January 1, 2011, with further reductions possible during the year. Italy, the second-largest European market, is likewise planning to cut its incentives in 2011, by a total of 18 percent. According to the EPIA, the main growth drivers will be the USA, China and “other” regions. In 2012, newly installed PV capacity is expected to reach 19 GW worldwide. Consequently, polysilicon manufacturers are expanding capacities further. Like WACKER, they have given the go-ahead for various projects that will increase global polysilicon output over the next few years. In 2011, polysilicon production is expected to exceed 200,000 metric tons worldwide. WACKER has already sold its entire annual output for 2011 to diverse customers. The Group has also signed contracts for 2012’s annual production.

Slowdown in Chemical-Industry Growth

The chemical industry will increase its output and sales in 2011. After 2010’s growth spurt to make up for lost ground, production is expected to rise by 2.5 percent and sales revenue by 4.0 percent in 2011. The German Chemical Industry Association (VCI) forecasts a 1.5-percent rise in producer prices. The VCI sees particularly good prospects for the chemical sector in the BRIC countries (Brazil, Russia, India and China). Although the export total to these countries is less than 8 percent, it is growing at a dynamic rate. WACKER has been preparing for this development in recent years, expanding its global production and sales network. Over the next two years, we expect Brazil, China and India to deliver particularly robust growth due to further rises in their standard of living.

Construction Industry Emerging from Trough

According to Global Insight, a market research institute, the construction industry bottomed out in 2010 and will slowly start to expand again in 2011. Growth is expected to continue in 2012, driven mainly by Asia and by the revival of America’s construction market. Western Europe’s performance lags well behind. WACKER believes it is well positioned for the years ahead, thanks to its construction-sector product portfolio. By 2025, two-thirds of the world’s population will be living in megacities, creating fresh challenges for how people build and live, and for the infrastructure needed. WACKER has the right products and solutions to benefit from the drive to cut CO₂ emissions and from the resulting demand for energy-efficient building techniques. In particular, we see good growth prospects for thermal insulation systems.

Regional Construction-Industry Growth 2010 – 2015 p.a.

Further Expansion in Electrical and Electronics Sectors

The electrical and electronics sectors will continue to grow worldwide in 2011. According to the German Electrical and Electronic Manufacturers’ Association (ZVEI), market volumes will rise by 6 percent to more than €2.8 trillion. The rate of growth in emerging and developing countries will be greater, at 8 percent. As for advanced economies, growth is expected to reach 4 percent. WACKER SILICONES sees potential for increased product sales in the fields of automotive electronics and power generation.