The European commission plans to make peace with the Chinese government by reducing the punitive tariff to 11.8% for 2 months starting on June 6. They tend to reach a consensus with the Chinese government on the dumping incident through diplomatic negotiation, but if Chinese PV manufacturers still fail to abide by the stipulations by August 8, the European commission will once again impose the original tax rate (which will be an increase from 37.2%-67.9%). In other words, these two months will be a break for Chinese PV industries to re-create their business plans.
According to EnergyTrend, a research division of TrendForce, the 11.8% punitive tariff in the first stage was an acceptable amount to the manufacturers, and it only had a small effect on product price. EnergyTrend discovered that the current average price of related products shipped to Europe is $0.5€/Watt, and calculated by the current exchange rate and tax rate, the average price of products shipped to Europe in June will be $0.559€/Watt (approximately $0.732USD/Watt). Compared with other non-China made products, such products still have a price advantage. In addition, Taiwanese manufacturers have determined the price in June, and even though Europe’s policy has changed, manufacturers still believed that price will not be affected.
Moreover, Chinese manufacturers have started to shift production in order to reduce business risk. EnergyTrend indicated that Chinese module manufacturers have already planned to shift their production in order to avoid the anti-dumping and countervailing punitive tariff, and the business transfer is now becoming more intense. Yingli, for example, may start producing related products in the US or Europe, ReneSola has already outsourced their production to Europe, and CSUN has started to produce cells and modules by cooperating with other manufacturers in Turkey.
As for the spot market, the more vivid market trend, China’s possible anti-dumping and countervailing subsidy on polysilicon, and the price change made by several manufacturers have caused a slight price change in the market. Silicon wafers were still in short supply but customer demands were still high, suggesting a great opportunity for manufacturers to raise price; however, product price has already reached the acceptable limit of customers, thus price only increased slightly. Cells were still in short supply because regardless of Europe’s policy change, customers did not cancel their orders. In addition, cell price in June was also defined. Moreover, due to the significant demands during the peak period as well as effects brought by the policy, module price still steadily increased.
