Ministry of Commerce of People’s Republic of China (MOFCOM) recently announced that there were subsidies to the US polysilicon under investigation which led to substantive damages toward China’s domestic industry. Thus, countervailing duty of 6.5% has been imposed on two of the US manufacturers, Hemlock and AE Polysilicon. According to EnergyTrend, a research division of TrendForce, most of the Chinese polysilicon manufacturers have resumed production, which will increase polysilicon capacity. Hence, the anti-subsidy duty will have limited impact on price as price is not likely to increase in the future.
As Indicated by EnergyTrend’s investigation, the annual growth rate for Chinese imports of US polysilicon was about 85% in 2012. In addition, based on the data announced by MOFCOM, the amount of the imported polysilicon that is subsidized by the US government has continued to go upward. It increased by almost 100% in the first half of 2012 compared to the same period in 2011. Judging from the demand of Chinese solar-grade polysilicon in 2012, the proportion of imports from the US accounted for more than 20%.
EnergyTrend believes that the anti-subsidy duty will have limited impact on polysilicon market price. Since China has announced the anti-dumping tariff before, the tax rate imposed on US manufacturers have reached 53.3%-57%. In another word, the market price has already been affected at that time. Moreover, the anti-subsidy duty is far less than the tax rate mentioned above. Therefore, market price is not likely to fluctuate significantly this time. On the other hand, due to the less damage towards the Korean manufacturer, OCI, and European manufacturers throughout the polysilicon anti-dumping investigation, Chinese manufacturers have turned to European and Korean manufacturers for purchase. Yet, Chinese polysilicon manufacturers still face tough challenges from the worldwide competition.
The rising of the Chinese domestic market causes polysilicon price in China to gradually increase, which also allows Chinese polysilicon manufacturers to resume production. For example, TBEA’s capacity of 12 thousand tons will be mass produced by the end of the year; CSG has resumed production this August after eleven months of delay on polysilicon production; and Sinosico has also aggressively worked on production re-activation. EnergyTrend believes that it’s not likely for polysilicon price to continue increasing due to the falling downstream market prices and the Chinese manufacturers’ resumed production, which will lead to flexible supply in the future.
Judging from spot market’s overall performance, Chinese polysilicon price remains between RMB132/kg-RMB135/kg. Affected by the result of countervailing duty, buyers have requested certain manufacturers to lower the price, which causes this week’s average price to reach US$16.975/kg, a 0.06% drop. For silicon wafers and cells, this week’s price remains steady. For modules, the competition between USA and Japan is intense. The price continues to drop with this week’s price reaching US$0.674/Watt, a 0.44% drop.