SEA solar imports hit with up to 3,521% in US tariffs
The duties announced on Monday are the culmination of a year-long trade probe which found that solar manufacturers in Cambodia, Vietnam, Malaysia and Thailand were unfairly benefiting from government subsidies and selling exports to the Unite States at rates lower than the cost of production.
The investigation was sought by domestic solar manufacturers and initiated under former US president Joe Biden.
While the duties benefit domestic manufacturers, they will also pinch the United States' renewable developers that have long relied on inexpensive foreign supplies, heightening uncertainty for a sector affected by political and policy changes in Washington.
The levies will be in addition to new widespread tariffs imposed by US President Donald Trump that have upended global supply chains and markets.
The antidumping and countervailing duties are designed to offset the value of alleged unfair subsidisation and pricing, as calculated by the Commerce Department.
The department's determination is a victory for domestic manufacturing that both Trump and Biden have tried to galvanise. Potential beneficiaries include Hanwha Q Cells and First Solar Inc.
Although the promise of subsidies and demand stoked by Biden's Inflation Reduction Act have helped drive a wave of interest – and investment – in new domestic solar panel factories across the United States, manufacturers warned those factories were imperilled by foreign rivals selling their equipment at below-market prices.
'This is a decisive victory for American manufacturing,' said Tim Brightbill, co-chair of Wiley's international trade practice and lead counsel for the coalition of solar companies that pursued the case.
'The findings confirm what we've long known – that Chinese-headquartered solar companies have been cheating the system, undercutting US companies and costing American workers their livelihoods,' he said.
Countrywide duties were set as high as 3,521% for Cambodia, reflecting the country's decision to stop participating in the investigation, according to the Commerce Department.
The United States imported US$12.9bil (RM56.4bil) in solar equipment last year from the four countries that would be subject to the new duties, according to BloombergNEF. That represents 77% of total module imports.
Companies not named in Vietnam face duties of as much as 395.9%, with Thailand set at 375.2%. Countrywide rates for Malaysia were posted at 34.4%.
Jinko Solar was assessed duties of about 245% for exports from Vietnam and 40% for exports from Malaysia. Trina Solar in Thailand faces levies of 375% and more than 200% from Vietnam. JA Solar modules from Vietnam could be assessed at about 120%.
Chinese solar stocks remained largely muted after markets opened yesterday, with Trina down 1.6%, Jinko down 0.9% and JA Solar down 0.1%, as the United States' decision was largely expected and companies have been moving some manufacturing capacity to tariff-free nations such as Indonesia and Laos.
According to a note by BofA Global Research, 'We don't think the higher rates will have much financial impact, especially post- recent reciprocal tariffs.'
Indonesia is expected to have more than 20 gigawatts of foreign-owned solar manufacturing capacity by the middle of this year, from just one gigawatt at the end of 2022.
However, other nations including India, Indonesia and Laos could be targeted by a possible new round of duties later this year, according to a note by Roth Industries citing Joseph C. Johnson, an associate director at Clean Energy Associates.
Chinese solar maker JA Solar said in a written response to Bloomberg News that the company is closely monitoring the US tariff development while accelerating its globalisation efforts.
These include a manufacturing plant in Oman that will start operation by the end of 2025 with six-gigawatt cells and three-gigawatt module capacity.
The duties hinge on separate action by the US International Trade Commission, which is set to decide in about a month whether producers are being harmed or are threatened by the imports.
After similar duties were imposed on solar imports from China roughly 12 years ago, Chinese manufacturers responded by setting up operations in other nations that weren't affected by the tariffs.
The United States initiated a probe triggered by an April petition from the American Alliance for Solar Manufacturing Trade Committee, which represents companies including First Solar, Hanwha Q Cells and Mission Solar Energy LLC.
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