BREAKING NEWS: U.S. SOLAR INDUSTRY WINS ANTI-DUMPING AND COUNTERVAILING-DUTY COMPLAINT VERSUS CHINESE, COULD TRIGGER TRADE WAR

 

According to a bulletin from the Coalition for American Solar Manufacturing (CASM), The Department of Commerce "will begin collecting duties back 90 days on Chinese imports."

According to CASM's public relations group, Oglivy,

"This is the first time the Department has ever applied critical circumstances before a preliminary determination. This is a win for CASM and the U.S. solar manufacturing industry.  Moreover, it confirms our report from last week that the Chinese were pushing product into the US market to avoid tariffs."

CASM has a brilliant sense of timing. They announced their initial claim during the U.S. solar industry's largest trade show in October. They just announced the decision by commerce during a phone briefing on a CASE study with findings on job losses due to tariffs.

Here's the text of the statement from the Department of Commerce:

"In summary, in accordance with section 703(e)(1) of the Act, we find that there is a reasonable basis to believe or suspect that certain subsidy allegations under investigation are inconsistent with the SCM Agreement, and we find that there have been massive imports of solar cells over a relatively short period from Suntech, Trina, and all other producers or exporters.

Given the analysis summarized above, and described in more detail in the Preliminary Critical Circumstances Memorandum, we preliminarily determine that critical circumstances exist with respect to imports of solar cells from the PRC for Suntech, Trina, and all other producers or exporters."

Although, the Department of Conmerce has not announced the size of the duties yet - the bottom line is that they have determined there has in fact been harm.

The SolarWorld/CASM solar panel anti-dumping and countervailing duties case is still percolating at the International Trade Administration. It's a case with long-ranging implications for U.S. and Chinese solar manufacturers and the entire U.S. solar ecosystem. We've covered the case in detail and have provided perspectives from a number of angles since its initial filing on October 19 of last year.

There's not much to do other than wait, now until March 2, and in the meantime the parties will busy themselves with publishing studies and launching further public relations campaigns.

The decision on countervailing duties will wait for another month.

According to the Department of Commerce,

"SolarWorld made a second timely request on January 19, 2012, for further postponement of the preliminary countervailing duty determination by 18 days, to March 2, 2012 and the department "has found no compelling reason to deny the request."

In Obama's State of the Union address last week, he announced the creation of a Trade Enforcement Unit to investigate trade issues, saying,

"I will not stand by when our competitors don’t play by the rules." 

CASM, the SolarWorld-headed coalition has estimated that

"Chinese producers have more than doubled imports of crystalline silicon solar cells and modules in advance of potential U.S. government duties on those imports, according to an evaluation of U.S. Customs and Border Protection data. The coalition alleges that the recent "110 percent surge in import volume since July 2011 is further proof of illegal dumping and subsidies by Chinese solar producers and warrants a finding of critical circumstances that would apply retroactive duties to Chinese imports."

CASM cites Suntech and Trina Solar as ranking amongst those Chinese producers.

Trina Solar has responded with these points:

• We are opposed to any suggestion that our U.S. imports surged as the result of efforts to evade potential tariffs.
• Nearly all of Trina Solar's U.S. shipments served orders tied to the federal 1603 grant expiration. We stand by our practices and the fact that they matched an increase in overall U.S. market demand.
• Further, due to production cycle and delivery logistics, it is an established industry pattern to see the majority of any quarter's shipments occurring in the last month.

We'll get you more details shortly on a new report by The Brattle Group on the economic and job impacts of tariffs on imported solar PV cells and modules.

We've contacted the International Trade Administration and asked them about the process itself, and specifically, about how and if citizens and concerned parties (other than the claimant) can make their views or evidence available. We await their response.

COMMENTARY:   In a blog post dated October 23, 2011, I reported on the anti-dumping and countervailing-duty complaint  filed by solar producer SolarWorld and the CASM with the U.S. Department of Commerce and International Trade Commission (ITC) on Wednesday, October 19, 2011.  

Gordon Brinser, president of SolarWorld Industries America Inc., said in a statement.

"Central planning has subsidized most facets of these companies' businesses.  China actually has no production cost advantage. China's labor is less productive, its raw material and equipment have come from the West, and China must pay for long-distance shipping. Yet massive state subsidies and sponsorship have enabled Chinese manufacturers to illegally dump their products into a wide-open U.S. market."

The complaint reads.

"Chinese producers and exporters have pushed - and will continue to push - large and growing volumes of dumped and subsidized [crystalline-silicon PV] products into the U.S. market, regardless of demand.  In the absence of the restraining effects of anti-dumping and countervailing-duty orders, the domestic industry faces a grim future."

The CASM demanded that the ITC and DOC to impose duties to counteract Chinese subsidies and bring the prices of imported solar products to true market levels.

John Smirnow, vice president of trade and competitiveness at the Solar Energy Industries Association said. 

"U.S. companies have the right to bring a case.  There are competitive pressures in the marketplace, and the coalition believes the competitive pressures are the result of unfair competition."

In a blog post dated October 29, 2011, I commented on the Chinese PV manufacturer's response to the U.S. solar coalition complaint.   Naturally, the Chinese PV manufacturer's claimed that the "allegations made by the U.S. petitioners will eventually prove to be unfounded" and that  "the transactions with its United States customers were made in accordance with international trade practices."

On January 25, 2012, the CASM sent out a press release titled, "Chinese producers flood U.S. market with solar cells and modules ahead of upcoming ruling in solar trade case."   The press release reads as follows:

"Washington, D.C., Jan. 25, 2012 – Chinese producers have more than doubled imports of crystalline silicon solar cells and modules in advance of potential U.S. government duties on those imports, according to an evaluation of U.S. Customs and Border Protection data released today by the Coalition for American Solar Manufacturing (CASM).  The coalition, which represents 11,000 U.S. workers at more than 150 American companies across the country, alleges that the recent 110 percent surge in import volume since July 2011 is further proof of illegal dumping and subsidies by Chinese solar producers and warrants a finding of critical circumstances that would apply retroactive duties to Chinese imports.

'This significant increase in imports demonstrates that the Chinese know they have violated U.S. and international trade rules and are trying to evade the consequences,' said Gordon Brinser, president of SolarWorld Industries America Inc., based in Oregon.  'Year to date, Chinese imports of solar cells and modules in 2011 are up 346 percent by quantity and 138 percent by value. Since 2008, Chinese imports have risen 939 percent by value and 1664 percent by quantity.  This most recent surge of Chinese solar imports gives the U.S. Department of Commerce the evidence it needs not only to make a preliminary determination in our favor, but also to apply a critical-circumstances finding to address this last-minute import surge.'

Under U.S. trade law, Commerce can make a finding of critical circumstances that requires importers of record to post bonds or cash deposits on tariffs on imports dating back 90 days from preliminary determinations on whether duties are warranted and, if so, by what margin.  A preliminary determination is expected on Feb. 13, meaning imports from Nov. 15 onward would be subject to duties.

Using publicly available data from the Customs and Border Protection’s Port Import Export Reporting Service (PIERS), CASM researchers found imports from Wuxi Suntech Power Co. Ltd.(known as Suntech), a Chinese manufacturer and respondent in the ongoing trade investigations, surged 76 percent in November, compared with October.  PIERS reports also show that imports from Changzhou Trina Solar Energy Co. Ltd.(known as Trina Solar), another Chinese manufacturer and respondent, spiked 209 percent in the first half of December, compared with the first half of November 2011.

Further, CASM research found numerous examples of companies stockpiling dumped and illegally subsidized Chinese imports, providing credible evidence to support a finding of critical circumstance. For example, Sun Electronics, a Miami importer and wholesaler, brought in 31,000 Chinese solar laminates on a single day: Dec. 21, 2011.  This enormous shipment, consisting of at least 77 shipping containers, required Sun Electronics to rent six forklifts and drivers and devote four-five other people to screen and sort the laminates.  Sun Electronics noted in an advertisement that it has recently obtained an entire second storage warehouse, likely demonstrating its intent to receive other large shipments of Chinese solar products.

'The Chinese have made it clear that, contrary to various World Trade Organization agreements they signed 10 years ago, they will employ any means necessary to dominate the American and international solar markets,' Brinser said.  'Rather than reward the Chinese for cheating, Commerce and the International Trade Commission need to take every possible action to enable American manufacturers to compete fairly.'

A complete list of the CASM findings can be found on the CASM website

On Dec. 2, the U.S. International Trade Commission issued a unanmimous preliminary determination that Chinese trade practices are harming the U.S. domestic solar manufacturing industry. The next step in the trade case will be Commerce’s Feb. 13 preliminary determination  on whether to levy countervailing import duties to offset the effects of any illegal Chinese subsidies. On March 28, Commerce is scheduled to make its preliminary antidumping determination, imposing duties to offset the effects of Chinese import pricing at artificially low prices."

The CASM also released a comprehensive report of solar cell and panel imports to the U.S. for all countries, including China.  Here is the summary totals from the report pertaining to China's solar cell and panel imports:

• Total Year 2008:  $233.3 million
• Total Year 2009:  $424.0 million
• Total Year 2010:  $1.2 billion
• Total Year 2011:  $2.4 billion
• Total November 2010:  $189.7 million
• Total November 2011:  $277.9 million

You can download a copy of the above report HERE.

It's obvious that China must've known that the U.S. Department of Commerce would impose penalties, so they flooded the market to the tune of $277.9 million in solar cells and panels in November 2011.   Sneaky, sneaky, sneaky.

Whether this anti-dumping and countervailing-duty complaint victory by the U.S. solar industry will spark a round of similar trade complaints in other industries remains to be seen or even spark retaliation by the Chinese on U.S. imports into China remains to be seen.  

Courtesy of an article dated January 30, 2012 appearing in GreenTechSolar and a press release dated January 25, 2012 by the Coalition for American Solar Manufacturing (CASM) and CASM Solar Cell and Panel Import Report

 

 

Comments

[Tommy]

Ola Placas solares precios,

The PDF file is there. You probably need to upgrade your PDF reader. Thaanks for your feedback. Hope you visit my blog on a regular basis. Tommy

[Placas solares precios]

I can't see the pdf file. Thanks for the information, really useful.

[pete hawkins]

please post my previous comment...

[pete hawkins]

If the US solar manufactures cannot compete in a price war in an open market like this, that's the way it goes! There a lot of US businesses that count on buying low cost solar panels from overseas suppliers because they cannot compete against the large US solar suppliers and the customers want the best value, This mess was brought forward by the large US solar manufactures because they cannot run their business correctly against fair competition and want the US Government to step in and give them monopoly power over the US solar industry. Most major US manufactures or suppliers buy their products or components to manufacture products they manufacture or sell in the USA from China or another Asian supplier for obvious reasons and you cannot stop that.