Could Result in Major Drop in Prices & Bankruptcies

The USA government regulator on trade rules found that there was a case to be made of Chinese solar imports hurting the domestic USA solar panel manufacturing industry. This ruling which was made on 22^nd September followed months of acrimonious to and fro between the solar panel makers and the solar installers.

The major USA industry solar body SEIA along with its numerous associates made a case that a high duty on imports of solar panels would lead to a loss of thousands of jobs in the industry which mainly run on solar equipment imports from China and other Asian countries. Five years of anti-dumping duties and countervailing duties on Chinese imports have not saved the USA solar panel industry as major Chinese companies such as Trina Solar, Jinko Solar, GCL Poly and others have easily circumvented the duties by setting up bases in other low-cost locations like Vietnam, Malaysia, and others.

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In 2016, solar panel prices dropped by 30% leading to most of the USA factories running steep losses as they were unable to adjust to the sharp and precipitous drop in solar panel prices. Solarworld and Suniva declared bankruptcy unable to deal with such low prices. In recent years, USA manufacturing companies had been able to survive as the steep price declines had stopped and some of them had even expanded capacities. But the 2016 fall resulted in most of the USA as well as Western manufacturers going out of business.

Also, read about effect of Imposition of ADD on Solar Panel Imports in India

The USA ITC in a ruling said that:

“U.S. International Trade Commission (USITC) today determined that increased imports of crystalline silicon photovoltaic cells (whether or not partially or fully assembled into other products) are being imported into the United States in such increased quantities as to be a substantial cause of serious injury to the domestic industry producing an article like or directly competitive with the imported artic”

The Commission will hold a public hearing on remedy on October 3, 2017.  The Commission will submit its report containing its injury determination, remedy recommendations, certain additional findings, and the basis for them to the President by November 13, 2017.

The critical date is November 13 when the ITC will forward its recommendations to the U.S.A President Donald Trump who will decide on whether to implement the recommendations or do something else. Given the political stance of Trump, it does not take a genius to figure out that harsh duties may be imposed on solar equipment imports. This could lead to the world’s second largest market being effectively shut for massive Asian solar panel capacity. A result could be a sharp lowering of prices in non-USA markets as the massive glut of solar panels tries to find a home. It could also result in another wave of bankruptcies, this time amongst the Tier 2 and Tier 3 Chinese solar panel companies.

Which companies will Benefit from USA imposing duties on Chinese Solar Imports

Some companies are set to benefit big time from this ruling as the ITC has not found Singapore, Australia etc. Singapore based REC which is owned by a Chinese conglomerate will be able to benefit. So will First Solar which as a large factory in the USA. Others will be deeply impacted as ITC found even Mexico and Canada also contributing to the harm to the USA domestic solar industry.