SMM News: the United States to increase taxes on Chinese products by 25%! The trade war between China and the United States has become a major concern in the near future. After Labour Day holiday, A shares also fell one after another.
What is the impact of the Sino-US trade war between the United States and the United States on China?
I. China's photovoltaic industry is more powerful in trade frictions
China is a big exporter of photovoltaic products and has continuous trade frictions with other countries in the world. According to the statistics of the China Mechanical and Electrical Chamber of Commerce, in the past five years alone, China's photovoltaic industry has suffered six international markets and 10 trade frictions, involving nearly US $30 billion. The specific statistics are as follows.
However, these trade frictions make Chinese photovoltaic enterprises stronger and stronger, and the export volume is increasing year by year. Although the unit price of photovoltaic products fell by 30% in 2018, exports increased by more than 10%, according to the China Photovoltaic Industry Association. The export volume of photovoltaic products in the past three years is shown in the figure below.
II. Sino-US Photovoltaic Trade War-201 Act
There has been a long history of photovoltaic trade friction between China and the United States. There have been four times since 2011, as shown in the figure below.
The biggest impact on the photovoltaic market in the past two years is the 201 Act of 2017.
On September 22, 2017, the United States International Trade Commission, USITC, issued a damage ruling on the global safeguards investigation of photovoltaic cells and modules ("201" investigation), agreeing that:
In the article 201 trade petition of Suniva and SolarWorld, it was found that there was significant harm.
The USITC survey found that a surge in imports of photovoltaic products in the United States has led to a sharp decline in the solar manufacturing industry in the United States.
USITC said we took this action because the US solar industry found itself in a desperate situation of overcapacity in foreign markets.
On January 22, 2018, President Trump confirmed the passage of Act 201, which would increase the 201 tariff on photovoltaic cell modules on top of the existing anti-dumping and countervailing duties by 30%, decreasing by 5% in each of the next four years. Every year, 2.5GW imported batteries or components have immunity.
Bill 201 can be extended for a minimum of four years and up to eight years; 201 impose a 30 per cent tax on the global market, but for Chinese companies, it has to be superimposed with a "double anti-tax rate". At present, the United States has a double negative tax rate of more than 65% on mainland China. On the other hand, mainland China levies a tax rate of more than 80% on components exported to the United States.
There is no doubt that such a high tax rate has a great impact on the export of photovoltaic products to the United States.
III. Impact on the Export of Photovoltaic products to the United States
The United States was once the second largest exporter of photovoltaic products from China. However, with the intensification of trade frictions between the two sides, the status of the US market to China's photovoltaic industry has declined year by year.
According to statistics from the China Photovoltaic Industry Association, the export of Chinese photovoltaic products to the United States has changed as follows since 2014.
A summary of the exports of Chinese photovoltaic products to the United States above is shown in the table below.
It can be seen that, affected by high tax rates, China's direct exports of photovoltaic products to the United States have been almost 0. 5% since 2018.
IV. The overall impact on the export of photovoltaic products
The United States accounts for the second largest cumulative installed photovoltaic capacity in the world, and the third largest in the world in 2018, as shown in the figure below.
If such a large photovoltaic market closes the door to China, will it have a great impact on the export of Chinese photovoltaic products? The answer, of course, is: there must be an impact, but not much!
According to customs export data, since the implementation of the US 201 Act in September 2017, the export volume of photovoltaic modules in China has increased month by month; from January to March 2019, the total export volume of domestic components reached 15GW, an increase of 70% over the same period last year! Especially in March, the monthly export volume exceeded 6GW!
A comparison of monthly exports from January 2017 to March 2019 is shown below.
It can be seen that the United States is China's photovoltaic products to impose tariffs, and has no impact on the development of the entire photovoltaic industry. On the contrary, it has pushed up the price of photovoltaic products in the United States, which is not conducive to the development of the photovoltaic industry in the United States.
In this trade war between China and the United States, the United States will impose a 25% tariff on Chinese products. However, the trade in photovoltaic products between China and the United States took place as early as 2017.
Once upon a time, the United States was the second largest exporter of photovoltaic products from China.
Since the implementation of Act 201, China's exports of photovoltaic modules to the United States have been almost zero since 2018. However, this does not affect the vigorous development of China's photovoltaic industry and the rapid increase in exports.
In August 2018, the European Union announced that the double anti-tax rate on dialogue photovoltaic products would expire on September 3, followed by a sharp increase in China's exports to the European Union.
The rapid growth of emerging markets, to China's photovoltaic products to provide a broad market!
As a result, the export volume of China's photovoltaic products has increased significantly, even in the case of a sharp decline in product prices, foreign exports have also increased year by year!
To sum up, the Sino-US trade war has little impact on China's photovoltaic industry.
Original title: analysis of the impact of Sino-US Trade War on Photovoltaic in China