In response to the International Trade Commission and U.S. Department of Commerce's ongoing investigation into possible trade violations, China-based solar module manufacturers have begun making plans to move certain production steps out of China.
The anti-dumping complaint and countervailing-duty petition filed last month by SolarWorld and its partners in the Coalition for American Solar Manufacturing could result in the implementation of steep tariffs – 50% to 250% – on modules imported from China, according to the New York Times.
Per the advice of their legal counsel, several manufacturers have all but accepted defeat and begun discussions with companies that import nearly complete modules into the U.S. for final assembly. Ocean Yuan, president of Eugene, Ore.-based importer Grape Solar, told the New York Times that the company is currently in talks with multiple unnamed Chinese manufacturers.
Meanwhile, China-based solar firms are considering filing their own anti-dumping complaint with China's commerce ministry, according to a Reuters report.
The probe – which would be launched by the China Photovoltaic Industry Alliance (CPIA) on behalf of several companies – would focus on imports of PV polysilicon from the U.S. Helped by subsidies, the volume of such imports has jumped in recent years, creating downward price pressure and hurting China's domestic polysilicon business, according to the group.
Wang Bohua, chief secretary of CPIA, told Reuters that the alliance's members are ‘all strongly urging’ the group to file the petition, although no official action has been taken yet.
Against this backdrop, China-based manufacturers can also expect to see increased PV module demand in their own country and the surrounding region. According to a new report from NPD Solarbuzz, PV installations in China will surpass installation totals in both the U.S. and Japanese markets by the end of this year.
In the Asia Pacific region, the PV market is forecast to grow 39% quarter-over-quarter and 130% year-over-year in the fourth quarter of this year (Q4'11). More than 2 GW of PV capacity are expected to be added this quarter, thus significantly increasing the region's share of the global market.
The region is poised to grow an additional 45% in 2012 as Asian governments introduce new installation targets. In China, the National Energy Administration recently revised its official cumulative solar installation target up from 10 GW to 15 GW for 2015. The country is projected to account for 45% of regional demand in Q4'11.
However, market constraints and downstream access issues still exist in most countries in the Asia Pacific region, the report notes. Financing, land use and regulatory issues still represent major barriers to large-scale projects in China. State-owned enterprises account for more than 50% of the 16 GW Chinese project pipeline.
‘As the European markets no longer present certain growth, the Asia Pacific markets are increasingly [becoming] the focus of international companies looking to expand,’ said Christopher Sunsong, an analyst at NPD Solarbuzz, in the report. ‘Companies seeking to take a share of this growth still face significant hurdles to define strategies to successfully access the downstream value chain.
‘These challenges, though, are unlikely to deter their determination to participate given the potential of this new regional market opportunity,’ he continued.