China fights back in solar trade spat, accuses US of poly-Si dumping

China’s solar industry, on the defensive after being accused of “dumping” solar technology into this country and harming domestic suppliers, is flipping the tables — saying that US companies are in fact doing the same thing in China with polysilicon material.

November 23, 2011 – China’s solar industry, on the defensive after being accused of “dumping” solar technology into this country and harming domestic suppliers, is flipping the tables — saying that US companies are in fact doing the same thing in China with polysilicon material.

The China Photovoltaic Industry Alliance told the China Daily that a report would be filed “soon” with China’s Ministry of Commerce, protesting what it says has been an influx of polysilicon that have sunk prices and harmed China’s own domestic suppliers. CPIA members include Yingli, LDK, GCL, Trina Solar, Suntech, and Daqo New Energy. (It’s unclear whom among them supports such a measure; Suntech tells Bloomberg it’s not them.) Another petition is said to be in the works to request an investigation into alleged subsidies received by US manufacturers.

“Foreign companies lowered polysilicon prices greatly in recent years and this has forced many Chinese polysilicon producers to go bankrupt,” Gao Hongling said. Chinese imports of polysilicon (from everywhere, not just the US) totaled 47,500 tons, more than double the amount in 2009, and August-September imports have set records at ~6500MT each (China’s full-year 2010 polysilicon output will be ~60,000 MT), according to the alliance. Many Chinese polysilicon factories have stopped or reduced production in the past few weeks, the CPIA claims. (Here’s a Google-translated version of the CPIA’s stance.)

An August 2011 report from the SEIA and Greentech Media, showing how US PV exports in 2010 more than offset imports, could actually be used to support these claims. In that report, PV polysilicon feedstock exports were calculated at $2.55B — compared to just $1.14B in 2009 — with the majority of that ($873M) going to China. (The next-most exported PV item was $1.40B of production equipment.) That’s even though about 25% of 2010’s 150K metric tons of global PV polysilicon came from the US, vs. 33% from China, as US share in polysilicon production has declined “due to the proliferation of a number of Asian polysilicon manufacturers.”

Part of the challenge for the CPIA may be to prove intent, just as it is the CASM group’s burden to convince US authorities to take action against alleged Chinese dumping of PV modules. Polysilicon prices have been on a downward march for months and even years, reaching new lows seemingly on a weekly basis — most recently sinking to ~$30/kg and soon expected to hit $25/kg. “Foreign companies lowered polysilicon prices greatly in recent years and this has forced many Chinese polysilicon producers to go bankrupt,” according to Gao of the CPIA. But the China Daily also cites an anonymous “analyst, surnamed Li” with a solar sector background, noting that unless US companies are selling below their production costs, “it is normal business competition instead of illegal dumping.”

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