By David Shepardson
(Reuters) – The U.S. Commerce Department said on Monday it plans to provide $325 million to Hemlock Semiconductor to significantly expand production capacity for semiconductor-grade polysilicon as it seeks to change the chip supply chain.
The government's $52.7 billion Semiconductor Research and Manufacturing Grant Program grant would support construction of a new manufacturing facility at the company's current site in Hemlock, Michigan.
“Polysilicon is the foundation of semiconductors and it is important that we have a reliable source of this material to make the chips that help support our economic and national security,” said Commerce Secretary Gina Raimondo.
The Biden administration has proposed billions in subsidies to major chipmakers such as Intel (NASDAQ:), TSMC, Samsung (KS:), and Micron (NASDAQ:) and wants a steady supply of polysilicon to meet the expansion of the production.
Hemlock is a joint venture owned by Corning (NYSE:) Inc and Shin-Etsu Handotai, a unit of Shin-Etsu Chemical.
Hemlock Semiconductor said it is “planning a once-in-a-generation investment in advanced technologies to continue serving as a leading polysilicon supplier to the edge semiconductor market.”
In total, the Biden administration has announced preliminary grants totaling $36 billion of the $39 billion set aside for manufacturing subsidies, but has only finalized one. Officials hope to reach final agreements on many others before the end of the year.
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