Latest Updates on CVD/AD Tariffs

The ruling on the anti-dumping (AD) tariff was announced last Thursday.  Many were surprised at the ruling of a 31 % tariff.  The Department of Commerce made this ruling in reaction to a complaint filed that the Chinese exporters were dumping cut-price panels in the US market.  This came on the heels of the related countervailing duties (CVD) tariff, which accused the Chinese government of subsidizing goods exported to our country, of only 2.9 to 4.73 percent which was announced in March.

Gordon Brinser, President of SolarWorld Industries, stated that “today’s announcement gives rise to the possibility that domestic solar manufacturing, environmentally sustainable solar production and robust global competition might one day soon return to boosting U.S. manufacturing, jobs and energy security.”  In his opinion, in the final determination the taxes could be even higher.  Many of the leading Chinese manufacturers deny that there has been any dumping and they are confident that the final tariffs will be lower than those set Thursday.  Both the CVD and AD tariff rulings will go through further Department of Commerce scrutiny and the final determination may differ from the numbers initially set. The DOC is currently set to make its final determination in early October 2012.

The solar industry is now left to wonder how this will affect the industry.  What will be the impact on price and market share?  The prices, industry wide, may initially go up but ultimately the price is determined by the free market and by demand.  The intent of the tariffs was to protect American manufacturers but will also benefit other companies outside the US who could now step in to fill in the gap.

Another issue of concern is the Chinese government’s reaction to these tariffs.  Chinese officials have threatened to impose trade duties on US shipments of polisilicon which is a key material used in solar panels.  A move like this would further disrupt global pricing.

The debate continues and the impact is yet to be seen.  It seems to be a step in the right direction of leveling the playing field.  As Frank Asbeck, chief executive of SolarWorld told Reuters, “The decision sends a clear signal: free trade does not mean there are no rules.”