EU solar manufacturers challenge China trade deal

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1 August 2013, Nuclear, Solar, Wind

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An amicable price undertaking of EUR0.56 per watt has been agreed for Chinese solar panel imports to Europe, alongside an import quota of 7GW per year, with the intention of creating a sustainable market equilibrium for solar panels in the EU. Yet many European manufacturers are not satisfied with the result, as the agreed price is even lower than the cost of Chinese solar panels back when the dumping complaint was first made, and is similar to the current market equilibrium price.

According to the group of European manufacturers preparing to file a lawsuit against this agreement, the minimum price is not adequate to undo the damage already done to the European solar market, and hence violates anti-dumping regulation 1225/2009. A formal complaint will be made, but changes as a result of a new lawsuit will not be effective before December, while the new regulations will come into effect on August 6, 2013.

Around 90 out of 140 Chinese solar panel manufacturers will participate in the voluntary agreement, thus avoiding anti-dumping duties of 47.6% that the other 50 manufacturers will face after August 6. The price floor has essentially given Chinese manufacturers a guarantee to be able to sell at dumping prices, causing shares of Chinese manufacturers to jump upon the news.

Prices greater than EUR0.50 per watt threaten large ground-mounted solar projects in the EU, where solar panels have reportedly been available for as little as EUR0.45 per watt. The price floor of EUR0.56 per watt will open a small opportunity for other manufacturers; for example, Taiwanese manufacturers hope to benefit from the deal by gaining market share from Chinese companies. The majority of European employment exposed by potential increases in solar panel prices is in the installation sector, where the deal is being welcomed.

The obvious losers are the European manufacturers that brought about the anti-dumping complaint to protect their interests. Any further legal challenge has little hope of relieving the intense price pressure in the European solar market, and it seems unlikely that European solar panel manufacturers will be able to compete for much longer against heavily subsidized foreign competition. / / @DatamonitorEN

Source: MarketLine

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