Who Lost and Who Won on Revised US duties on China made Solar Cells – Also Read responses by Trina, Suntech and Yingli
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October 12, 2012Revised US Duties
The US Government has got a complicated way of imposing duties on imported products considered to be receiving unfair subsidies and/or being dumped in US markets. The US Department of Commerce gave its final ruling on imports of Chinese made solar cells on 10th Oct, 2012 after announcing a preliminary ruling early this year. The rates for CVD and AD have been revised in the final ruling. While the countervailing duties (CVD) has been reduced, anti dumping duties (AD) have been increased which means that the effective combined rate remains in the same range though it has increased sharply for Suntech while it has decreased overall for Trina Solar.
Suntech seems the biggest loser as it will see its combined rate increase by almost 13% while Trina Solar will see its combined rate go down by 2%. GT Advanced Technologies a major exporter of solar equipment to Chinese solar panel producers also could lose as China retaliates by buying European. GCL, LDK and Renesola could benefit if China goes ahead and impose duties on imports of polysilicon from USA. Note the range of duties range from around 23.7% to 260% for different Chinese solar companies with the biggest exporters like Trina and Yingli being imposed the smallest penalties. However DOC has not expanded the scope of solar products from solar cells to solar modules as was demanded by the group led by Solarworld. The final ruling on whether these duties are justified will be made by ITC in November 2012. Overall, the new ruling does not change the picture much for either the Chinese solar panel manufacturers or the US ones (which continue to shut down).
Also Read:
The Commerce Department said yesterday imports of crystalline silicon photovoltaic cells made by Trina Solar would be subject to duties of 15.97 percent, up from a 4.73 preliminary rate imposed in March, to counter Chinese government subsidies. Duties imposed on similar goods produced by Suntech, the world’s largest solar-power equipment maker, were increased to 14.78 percent, up from 2.9 percent in March.
The U.S. will also impose anti-dumping duties of 18.32 percent on the value of Trina Solar imports, a reduction from the 31.14 percent penalty imposed in a preliminary finding in May. Suntech faces anti-dumping duties of 31.73 percent, slightly higher that a rate of 31.22 percent set in May.
An additional 59 Chinese companies will be subject to an anti-dumping penalty of 25.96 percent, based on a determination by the Commerce Department of how much below cost they were selling their goods. All other Chinese producers will be subject to a 249.96 percent rate to deter dumping.
Actual tariffs collected will be reduced by an adjustment because the companies are subject to both dumping and subsidy penalties.
The Commerce Department determined that most of the duties should be retroactive, beginning 90 days before the date of the preliminary findings. The U.S. International Trade Commission next month is scheduled to decide whether China’s policies have caused U.S. solar-energy manufacturers harm, a move that will determine whether the duties announced yesterday will stand.
Yingli Green Energy’s Muted Response
“The potential of the U.S. solar market is vast, and we remain dedicated despite the industry’s challenges throughout this past year,” said Mr. Liangsheng Miao, Chairman and Chief Executive Officer of Yingli Green Energy. “We will always be appreciative to the overwhelming majority of the American solar industry who stood behind us and the other respondents.”
Trina Solar’s Happy Response
Trina Solar, a producer and exporter of these products to the United States market, received a combined effective net rate of 23.75% (out of a range from 23.75% to 254.66%). This rate is comprised of AD duties of 18.32% and CVD duties of 15.97%, of which an export subsidy of 10.54% is subtracted from the AD duties calculation to avoid double application. Trina Solar has prepared for this potential outcome and continues to abide by its contractual commitments.
Suntech’s Response
“Unilateral trade barriers will not make any one company more competitive, but will make solar less competitive against other forms of electricity generation. These ill-conceived taxes on solar products were the outcome of an unrealistic analysis that compared, for example, Suntech’s costs of production to the theoretical costs of production in Thailand, a country with less than 100MW of PV production capacity. It’s unfortunate that the process works this way; however, Suntech is well-prepared for the future and to serve the needs of our customers,” said E.L. “Mick” McDaniel, Managing Director of Suntech America. “The growth of destructive trade barriers represents a significant, long-term challenge to the health of the solar industry in the U.S. and globally. Nobody benefits from a global solar trade war except for those who want a less competitive solar industry,” concluded Mr. McDaniel.