The World's #1 Renewable Energy Network for News, Information, and Companies.

Trade War Escalates: Chinese Seek Duty on US Silicon

Trade War Escalates: Chinese Seek Duty on US Silicon

Chinese polysilicon makers are pressing their government to impose duties on U.S. imports, a move to drive up prices for competing supplies of the material used in solar panels, four people familiar with the issue said.

Potentially escalating a trade dispute between the world’s biggest economies, GCL-Poly Energy Holdings Ltd., the largest supplier of polysilicon, along with Daqo New Energy Corp. and other producers presented data to the Ministry of Commerce, according to the people, who declined to be identified because the cases are private. The ministry hasn’t accepted the cases, a step needed for the producers to file anti-dumping complaints seeking the punitive import taxes, the people said.

“China’s Ministry of Commerce will consider Sino-U.S. trade to determine whether to accept the complaints,” Gao Hongling, deputy secretary-general of the China Photovoltaic Industry Alliance, said in an interview. She declined to name which Chinese companies are involved.

China is the world’s biggest maker of solar panels, a $37 billion global market. The prospect of duties on U.S. silicon suppliers such as MEMC Electronic Materials Inc. and Hemlock Semiconductor Corp. raises the stakes in the dispute over solarenergy equipment, an industry increasingly dominated by China.

MEMC fell 1.4 percent, its first decline in eight days. GCL-Poly dropped as much as 5.4 percent in Hong Kong today, the biggest intraday decline in 15 days.

The Obama administration last month said it will impose duties on imports into the American market of Chinese solar cells, which are the devices made from polysilicon and stitched together into panels that convert sunlight into electricity.

Unfair Subsidies?

The decision followed an investigation into whether China was unfairly subsidizing its solar-cell producers and is meant to offset such aid. Clean-energy manufacturers in both nations are struggling with an economic slowdown. The dispute over government support has added to tensions between them.

A duty on the main ingredient in solar panels may run counter to the interests of other Chinese companies, said Jenny Chase, head of solar research for Bloomberg New Energy Finance.

“While Chinese silicon manufacturers may be keen for tariffs on silicon imports from the U.S., the vast majority of Chinese solar companies buy silicon and so will be fiercely opposed to any measure that increases the price,” Chase said.

The Asian nation purchased 26,000 tons of polysilicon in the first four months, valued at $730 million at the current Chinese spot price, according to the Beijing-based trade group. The U.S. supplied 44.3 percent of the imports, it says.

GCL-Poly spokeswoman Jessy Fang said in an e-mailed statement the company had no comment. A call to Daqo New Energy wasn’t answered.

Price Comparison

The current spot price of domestic polysilicon is as much as $28 a kilogram, while the international price is $26 a kilogram, according to China Nonferrous Metals Industrial Association, a trade group.

Globally about 215,000 tons were produced last year of the material, also known as solar-grade silicon, with at least 25 percent from Chinese factories, according to New Energy Finance. China halted some production, because of cheaper foreign competition, according to Xie Chen, an analyst at the Nonferrous Association. He said in February that companies including Baoding Tianwei had suspended production.

Solar, Wind Energy Loans

The China Development Bank Corp. since 2010 has made available $47.3 billion in credit, which hasn’t been fully tapped, to support the country’s wind and solar manufacturers, according to a New Energy Finance study in October.

The U.S. has aided clean-energy companies with loan guarantees from the 2009 economic stimulus law and incentives such as a production tax credit for wind energy, which ends this year. The Energy Department has guaranteed about $14.9 billion in lending for wind- and solar-power initiatives, mainly for generation, according to the agency.

Polysilicon prices have plunged as output capacity has soared, particularly in China. Global production capacity is almost 300,000 tons a year, New Energy Finance estimates. Hong Kong-based GCL-Poly can make 65,000 tons a year.

The U.S. Commerce Department on May 17 set preliminary tariffs of as much as 250 percent on imports of Chinese solar cells. That responded to allegations from companies including the U.S. unit of Germany’s SolarWorld AG that Chinese-made cells were being sold at a loss in the U.S.

The Beijing government said on May 25 it filed a complaint with the World Trade Organization alleging that U.S. anti-subsidy measures undercut $7.3 billion in Chinese goods, including solar panels.

Copyright 2012 Bloomberg

Image: China flag via Shutterstock

RELATED ARTICLES

India's Seabiscuit: How Solar Energy Can Be the Symbol of Hope for Electricity Woes

Aditya Goel, Ornate Solar For those unfamiliar with the story of the horse that Hollywood made famous, Seabiscuit was a small horse who had an inauspicious start to his racing career. History though, remembers Seabiscuit not for his diminutive...
Tesla batteries

Advanced Microgrid to Buy Tesla Batteries for Storage Projects

Justin Doom, Bloomberg Advanced Microgrid Solutions, a provider of energy-storage systems, agreed to buy as much as 500 megawatt-hours of battery capacity from Tesla Motors Inc.
Gavel

Three Chinese Solar Panel Groups Lose Exemption From EU Tariffs

Jonathan Stearns, Bloomberg

The European Union applied tariffs on three groups of Chinese solar-panel makers that have been exempted from the levies, potentially reviving tensions in the EU’s biggest trade case of its kind.

Stock graph

Green Bonds Sprout as Wall Street Embraces Renewable Energy Debt

Cordell Eddings, Bloomberg Bonds backing clean energy and other sustainable initiatives are booming. Investors are snapping up green bonds at the fastest pace on record, as big banks like Morgan Stanley and Bank of America Corp. pile in with new iss...

CURRENT MAGAZINE ISSUE

Volume 18, Issue 3
1505REW_C11

STAY CONNECTED

To register for our free
e-Newsletters, subscribe today:

FEATURED PARTNERS



EVENTS

PV-301: Advanced PV Design & Installation

This highly desirable and advanced course is intended for the profession...

PV-401: Advanced Field Training

Real world on the job solar installation, training, and experience is th...

PV-201: Introduction to PV Design & Installation

PV 201 Introduction to PV Design & Installation is simply the best i...

COMPANY BLOGS

Five Reasons to Go Solar Now

Solar’s popularity has skyrocketed recently, thanks to a price dro...

Community Solar Solutions Appeal to Eco-Conscious Millennials

Tech savvy and convenience oriented, the millennial generation is the mo...

Building Rapport

How do you build rapport with your prospect? This is a question that I a...

SOCIAL ACTIVITY

Tweet the Editors! @megcichon @jennrunyon

NEWSLETTERS

Renewable Energy: Subscribe Now

Solar Energy: Subscribe Now

Wind Energy: Subscribe Now

Geothermal Energy: Subscribe Now

Bioenergy: Subscribe Now  

 

FEATURED PARTNERS