Based on the recent U.S. Department of Commerce's countervailing duties (CVD) preliminary ruling, anti-dumping (AD) preliminary results can be deduced to be in line with the CVD rulings, analyzesEnergyTrend, the Green Energy Research Division ofTrendForce,the Global Market Intelligence Company. Products included in the AD preliminary ruling should be similar to the CVD ruling. Under the premise that the final rulingis identical to the preliminary ruling and under the assumption thatproduct volumes cap and pricing limitations are not imposed, EnergyTrend estimates that Chinese and Taiwanese manufacturers will come up with different strategies to reduce the impact from the imposed tariffs.
For Chinese manufacturers, modules’ origins are defined by where theywere assembled. Therefore, Chinese module manufacturers may turn to outsourcing in other countries. Data collected by EnergyTrend shows that Mexico is the most likely nation for Chinese manufacturers to build pipelines overseas. In contrast, Taiwanese manufacturers are less likely to establish foreign factories because of two reasons: 1) Taiwanese manufacturers’capacity scales are far smaller than Chinese manufacturers’, and 2) Taiwan’s main export markets are Japan and Europe. Yet, some Taiwanese manufacturers have built PV factories bases overseas, and they may benefit from this opportunity; they may also consider the possibility of expanding foreign production capacities.
EnergyTrend believes that the Taiwanese and Chinese manufacturers need to carefully evaluate strategies for PV cells. This is because cells’ country of origin are mainly linked with manufacturers, meaning that their foreignfactorieswill notbe of help in evadingtheimposedCVD tariffs. This can be an unpredictablevariableto future strategies. On one hand, Chinese buyers can purchase PV cells from other countries; those manufacturers from these countries who are potentially cost-competitive may benefit as a result. Southeast Asian and Korean manufacturers like REC Solar and LG are those worth monitoring. On the other hand, the extent of the AD tariff ratesimposed will significantlyaffect Taiwanese manufacturers. If the rates are as low as Taiwanese makers’ expectations, representing a limited cost increase, it is possible for Taiwanese makers to maintain their competitiveness by improving conversion efficiency and optimizing producing costs. However, if the tariff rates are higher than expected, it will inevitable that Taiwanese makers will lose orders. EnergyTrend believes that worst case scenario would be losing majority of the American orders.
Crystalline silicon wafers and Ingots:
Origins of crystalline silicon wafers and ingot are in line with PV modules. Therefore, EnergyTrend expects that it is highly possible for some Chinese and Taiwanese manufacturers to move their capacities abroad. Oversea investments in Indonesia and Malaysia may therefore be implemented. Moreover, REC Solar will remainthe benefitting party from this ruling, so the company may carry out its capacity expansion plan in Singapore as per the earlier rumors.
As Taiwanese and Chinese PV manufacturers have to face challenges from the CVD and AD rulings, Southeast Asian and Korean manufacturers are make benefit from this situation. In addition to REC Solar and LG, Malaysian government has also beenaggressive in pushing its solar industry development programs. Chinese manufacturers may support Malaysian makers through shiftingorders and export modules to Malaysia instead of Taiwan for the US market. Furthermore, US-based PV manufacturers such as First Solar and SunPower, which have been focused on system installations for years, are likely to expand their market share in the U.S. CIGS thin-film makers including Solar Frontier and TSMC Solar are also expected to benefit and increase their market visibility in the U.S.