Chinese Solar Panel Exports Spike as Obama Announces New Trade Enforcement Unit

Trade tensions with China are rising, and the solar and renewable energy industry is at the forefront. In his State of the Union address to Congress Tuesday night, President Obama announced the creation of a Trade Enforcement Unit to investigate illegal trade practices and subsidy programs by countries, such as China, a fellow World Trade Organization (WTO) member. "I will not stand by when our competitors don’t play by the rules," the President stated.

On Wednesday, the Coalition of American Solar Manufacturers (CASM), released statistics on Chinese exports of solar panels and modules to the U.S. for 2011, further evidence that Chinese manufacturers are engaging in illegal dumping and the Chinese government is engaging in illegal international trade subsidies.

Based on US Customs and Border Protection Service data, CASM estimates that Chinese exports have increased 110 percent since July, 2011. Year-to-date through November, 2011, they've increased 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.

"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,” stated Gordon Brinser, president of Oregon's SolarWorld Industries America Inc., the lead petitoner in CASM's filing of anti-dumping and countervailing duty petitons last October.

Dumping, illegal subsidies investigations under way

The US International Trade Commission (ITC) and Commerce Dept. - the authorities responsible for adjudicating international trade disputes to do with WTO agreements here in the US - are conducting investigations into the claims made in the peititons that could result in the imposition of countervailing duties on Chinese silicon solar photovoltaic (PV) imports on the order of $1 billion by CASM's calculations.

The Commerce Dept. can impose countervailing tariffs retroactively if it finds critical circumstances exist. That could entail requiring importers of record to post bonds or cash deposits for tariffs on imports dating back 90 days from preliminary determinations on if duties are warranted and, if so, according to a countervailing duty margin. A preliminary determination is expected on Feb. 13.

Huge spike in Suntech, Trina Solar Module, panel imports

"We believe that most of this surge represents an attempt by Chinese manufacturers to get additional product into the United States before the Commerce Department's likely decision to impose duties to counter illegal subsidies that is due Feb. 13 and supports our case that the Department should apply a critical-circumstances finding, meaning imports from Nov. 15 onward would be subject to duties."

Detailing some of its findings, CASM researchers found that the world's largest silicon solar PV manufacturer, Suntech, or Wuxi Suntech Power Co. Ltd., spiked 76 percent higher in November on a monthly basis alone, according to the publicly available data from the Customs and Border Protection Service's Port Importing and Exporting Reporting Service (PIERS).

PIERS reports also show that U.S. imports from another major Chinese solar panel manufacturer, Trina Solar, or Changzhou Trina Solar Energy Co. Ltd., spiked 209 percent higher in the first half of December as compared to the corresponding period in 2010.

Stockpiling Chinese solar panels at U.S. ports

CASM's researchers also found "numerous examples of companies stockpiling dumped and illegally subsidized Chinese imports, providing credible evidence to support a finding a critical circumstance." Miami importer and wholesaler Sun Electronics brought in 31,000 Chinese solar laminates on Dec. 21 alone, for instance.

"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." In addition, Sun Electronics recently leased a second storage warehouse, an indication that it expects to receive additional large shipments, CASM notes.

“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.”

* Photo Oakland port courtesy IndyBay.org

A complete list of CASM's findings can be found on the organization's website.