New Solar Storm Brews in Europe 欧盟或发起反倾销调查中国光伏业再蒙阴影

By newsdoug on March 7, 2012

Solar storm intensifies with new EU probe It seems the storm dumping rain on Chinese solar cell makers for most of the last year won’t end anytime soon, with Chinese media now citing gloomy industry watchers saying Europe is likely to soon launch an own anti-dumping investigation into the industry following a similar one in the US. (English article) I don’t want to rush to judgment here, but perhaps it’s time that Beijing and China’s solar firms themselves admit that perhaps they are unfairly subsidized by the Chinese government, and try to work with European and US government officials to find a new plan that would address everyone’s concerns. Of course that doesn’t seem likely to happen anytime soon, with China continuing to deny that it unfairly subsidizes its industry, which now produces more than half of the world’s solar cells, with things like export rebates, low-interest loans and other incentives like free or cheap land. According to a report on the front page of today’s China Daily business section, a Commerce Ministry official says the European Union has already accepted complaints from its own solar cell makers over anti-dumping allegations against their Chinese rivals, and is likely to soon launch an official investigation, which means punitive tariffs may be coming soon if the investigation results in a ruling against China. Such a ruling would be even more devastating to Chinese solar cell makers than a similar ruling likely to come soon from the US, as Europe now account for a hefty 80 percent of all of China’s solar-related exports, with shipments of solar panels to the market worth more than $30 billion in 2010. Battered shares of Chinese solar firms, struggling to recover from their industry’s worst-ever downturn for most of the last year, tumbled even more on Tuesday trade in New York as word of the possible EU investigation spread. Industry leader Suntech (NYSE: STP) dropped 6 percent to $2.85, once again approaching its all-time low after a February rally on hopes that the industry’s downturn had bottomed out and prices were starting to stabilize. Other solar firms saw similar results on Wall Street, with Yingli (NYSE: YGE), Trina (NYSE: TSL) and Canadian Solar (Nasdaq: CSIQ) all down between 3 and 4 percent. Recent signals coming from the sector in its latest quarterly results indicate that many executives are cautiously optimistic that a rebound is on the way, partly driven by an anticipated big jump in building of new solar power plants in their home China market as well as many other developing markets. Such a mini-boom may indeed be coming, but it will hardly be sufficient to offset the huge losses that all of these companies would suffer if they lose access to the US and EU markets that now account for most of their sales. If that happens, which looks very likely, don’t expect to see any of these companies return to profitability anytime soon.

Bottom line: An anti-dumping investigation against Chinese solar panel makers in Europe looks likely, dealing an even bigger blow to the sector than a similar ongoing US investigation.

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