The threats of retaliation have materialized. Just weeks after the European Commission at the behest of SolarWorld-led consortium, EU ProSun launched an anti-dumping investigation into Chinese imports of photovoltaic wafers, cells and modules into the EU, MOFCOM has reportedly announced the start of an investigation into imports of solar grade polysilicon into China. The European Commision declined to provide a comment to pv magazine on the news.
Various media, including the Financial Times, Business Week and the Wall Street Journal have reported that the investigation will be added to Chinas investigation into polysilicon imports from the U.S. and Korea. In the U.S. and Korean investigation, while MOFCOM is officially giving itself until the middle of 2013 to carry out the analysis, according to Chinese media "preliminary findings" could be announced as early as this month.
Meanwhile, quoting Chinese customs data, the Financial Times says that Chinese imports of polysilicon from EU member countries were worth at least US$870 million in 2011. Germany is said to be the biggest exporter of polysilicon.
According to China-based GCL-Poly Energy Holding, the average selling price (ASP) for its silicon in 1H 2012 dropped to US$23.20 down 60% compared to the previous year. On average in Q2 2012, this ASP was only US$21.80.
Robert Schramm-Fuchs, an analyst at Australian investment bank Macquarie added, "In the meantime, silicon prices have dropped to below 20 dollars and are also hardly likely to recover before the second half of 2013 due to the existing overcapacities." Goldman Sachs is anticipating a sustained price decline until at least 2014, which could even go as low as US$15.
Polysilicon driving module price declines
In August, four Chinese polysilicon producers reportedly urged the Chinese government to initiate an anti-dumping and anti-subsidy investigation into European imports of solar grade polysilicon. Shortly before, MOFCOM published a statement on its website saying that it is not cheap cells coming from China, which have led to module price declines, but rather it is polysilicon price reductions that have driven module price decreases.
"The down-going of pricing of raw material for PV cells and advancement of technology is the main reason for Chinas PV cells competitive price. It is not the dumping claimed by some EU companies. Price of polysilicon imports, the major raw material for PV cells keeps going down, from the highest of nearly 300 USD/kg in 2008 to less than 30 USD/kg at present, which brings about a down-going price of PV cells," read the statement.
The November edition of pv magazine includes a comprehensive look at the global polysilicon industry. Author Oliver Ristau reported, "Against the background of this [trade] conflict, Chinese silicon suppliers who had previously disappeared from the market appear to be sensing a second spring.
"At any rate, the Australian investment bank Macquarie in its latest report about polysilicon with reference to indigenous sources points out ‘that presumably in anticipation of antidumping import tariffs [ ] six domestic polysilicon producers restarted operations after they originally shut down [their sites] around the turn of the year. As a consequence, 14 domestic polysilicon producers now seem to be in operation again.' If China really were to impose import tariffs on silicon, the global shake-out which the bankers have so far seen at work mainly in China could shift geographically.
"The bank goes on to say, ‘In the case of Chinese import tariffs, the global polysilicon oversupply outside China seems to worsen significantly.' The profitability, mainly of the companies with the highest production costs comparatively speaking, will suffer as a result. The bank warns, however, that even in China the processing industrys silicon requirement is not enough to keep all the indigenous producers busy."
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