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Polysilicon prices are falling rapidly, thanks in no small measure to a serious slowdown in the chip sector. And that's good news indeed for solar companies.

Dan Ries, an analyst with Collins Stewart, reports today that polysilicon prices have declined about 20%-30% over the past three weeks. In a research note, he says that prices for high purity polysilicon are down about $100/kg to about $300/kg. Ries notes that he has been expecting a drop in poly pricing by mid-2009, but that it is hitting sooner than expected due to the slowdown in the semiconductor business, the other major consumer of poly supply. Ries thinks the semi industry will use 20%-30% less poly in Q4 than in Q3, freeing up more supply for the solar industry.