The US on Tuesday dealt a blow to US manufacturers of solar panels and boosted shares in Chinese rivals when it imposed unexpectedly low preliminary punitive duties on imports from China, though the move still drew fire from China industry representatives.
A Chinese industry group said despite the low duties the decision was unfair and went against international trade laws.
“If the US finally decides on the tariff, US solar energy costs will increase sharply and shrink the energy market,” the China Chamber of Commerce for Import and Export of Machinery and Electronic Products said in a statement.
Photo: Reuters
“The decision will harm the long-term interest of the solar industry as a whole,” it said
Energy analysts had expected Chinese imports of solar panels to be hit with preliminary duties of 20 percent to 30 percent, but the rates announced on Tuesday ranged from just 2.90 percent to 4.73 percent.
The Commerce Department set a preliminary duty of 2.90 percent on SunTech Power Holdings (尚德電力), the world’s biggest producer of photovoltaic solar panels, and a preliminary duty of 4.73 percent on Trina Solar (天合光能), another major Chinese producer, industry officials said. All other Chinese solar panel producers and exporters received a duty rate of 3.59 percent.
The move pushed up shares of Chinese solar firms in Hong Kong on Wednesday, with GCL-Poly Energy Holdings (保利協鑫能源) rising as much as 4.8 percent and Solargiga Energy Holdings (陽光能源) up nearly 3 percent, beating a flat broader index and tracking gains in Wall Street peers overnight.
“Punitive tariffs of less than 5 percent would be manageable for Chinese solar makers given that their panels are sold 25 to 30 percent cheaper than US-made panels,” said Min Li (李敏), head of alternative energy at Yuanta Securities (元大證券).
The “surprisingly low” numbers would likely mean that the major Chinese companies would need to pay between about US$5 million to US$10 million to cover products shipped, said Timothy Arcuri, an analyst with Citigroup, adding that this in itself would have a relatively minimal impact.
Chinese solar panel makers depend on exports for more than 90 percent of their earnings and the US is their second-largest market, after Europe.
Rapid expansion by Chinese companies has created a glut of solar panels that drove prices down sharply last year, pushing some weaker US companies, including Solyndra, into bankruptcy.
The Coalition for American Solar Manufacturing, a US industry group that has complained that massive Chinese subsidies were driving them out of business, tried to put the best face on the news.
It said the US Commerce Department would uncover more subsidies and unfair pricing practices as it continues its probe in the coming months, which would result in higher final duties.
“Today’s announcement affirms what US manufacturers have long known: Chinese manufacturers have received unfair and WTO-illegal subsidies,” said Steve Ostrenga, chief executive officer of Helios Solar Works in Milwaukee, Wisconsin.
Senator Ron Wyden, an Oregon Democrat who has been a driving force behind the case, also said he expected duties to “significantly swell” as the case proceeds.
The US imported US$2.8 billion worth of solar cells and panels from China last year, up sharply from about US$1.2 billion just a year earlier, according to industry estimates.
The Commerce Department will announce preliminary anti-dumping duties in May to address a separate set of charges that Chinese producers are selling solar panels in the US market at unfairly low prices.
Chinese producers and US companies opposed to the duties said the preliminary decision on Tuesday belied charges that China was flooding its solar sector with subsidies.
“We’re pleased and in large part feel vindicated,” Robert Petrina, managing director of Yingli Green Energy Holding’s (英利綠色能源) US business said.
Jigar Shah, president of a coalition of US solar panel sales and installation companies which were opposed to duties, called the ruling an “initial victory for America’s solar industry and its 100,000 employees” because it would not significantly raise prices for solar products and hurt demand.
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