Last week, China’s Ministry of Commerce and General Administration of Customs announced to suspend imports of processed polysilicon since September. This move is generally interpreted as a bargain chip in future trade negotiations with the US.

China has decided to impose anti-dumping and anti-subsidy duties on US- and Korea-made solar-grade polysilicon since January, 2014. Nonetheless, Ministry of Commerce introduced a “handbook” of trade processing rules and implemented the rules on processed polysilicon, leaving a loophole for the foreign importers. Yet, the ministry suddenly suspended the polysilicon imports with an official explanation: the volume of imported polysilicon shares almost 80% in domestic market, creating severe stress on Chinese polysilicon makers.

The rush decision indicates anti-dumping duties will be again imposed. With anti-dumping tariff rates of 53.3%-57% on US and 2.3%-48.7% on Korea, imported polysilicon will no longer be compatible to Chinese products. As the move was taken only one month after US’s new punitive CVD and AD duties for Chinese PV products, the high duties will provide relief to struggling Chinese PV manufacturer. Additionally, the retaliative move can be a measure to negotiate with the US and EU on recent solar trade wars.

Today, a report on Bloomberg suggests a possible war settlement between China and the US. With Obama’s green policies, it is necessary for USA to encourage people to install solar systems, making cheaper products more essential. As the high AD and CVD tariffs would retroactively affect the US solar market, it seems more possible for the two nations to have trade talks in order to bring a win-win conclusion.