Wuxi, China-based Suntech Power Holdings (NYSE: STP) said today it signed a eight-year contract for the supply of polysilicon from South Korea's DC Chemical.

Suntech, a manufacturer of photovoltaic cells and modules, said the $631 million contract covers the period between January 2009 and December 2016.

"Partnering with DC Chemical for high quality polysilicon will help to expand Suntech's relationship with companies in the South Korean solar industry as well as building our long-term supply pipeline and accelerating our path to grid parity solar," said Zhengrong Shi, chairman and CEO of Suntech.

In February, DC Chemical signed two deals to supply Yingli Green Energy Holding (NYSE: YGE), based in Baoding, China (see Yingli to get polysilicon from DC Chemical).

Yingli said it would get $27 million worth of polysilicon from DC Chemical in 2008 under the first agreement,  and $188 million from 2009 to 2013 under the second contract.

Suntech's Shi said, "The funds from our recent convertible senior notes offering have put us in a strong position to enter into large, long-term contracts such as this one with DC Chemical, which we believe will enable us to establish a strong foundation for a grid parity cost structure in the future."

"Suntech will continue to build relationships with respected upstream polysilicon producers with a similar view to achieving solar grid parity as early as possible," he said.

DC Chemical makes coal chemicals, basic chemicals, petrochemicals and fine and specialty chemicals.

Suntech designs, develops, manufactures, and markets a variety of solar products for electric power applications in the residential, commercial, industrial, and public utility sectors.