US Solar Group seeks retroactive duty on panels imported from Vietnam and Thailand

A group of U.S. manufacturers of solar panels asked the Commerce Department to consider imposing retroactive duties on Vietnam and Thailand because there has been a surge in imported goods. These countries are also under investigation for unfair trade practices.

The Commerce Department began an investigation in May into silicon solar panels and cells made in Vietnam. Thailand, Malaysia, and Cambodia. A group of American manufacturers claims that the products were sold at low prices in the U.S. and received subsidies from China. Many manufacturers in the region have factories in China.

According to U.S. Trade data, the four Southeast Asian countries represented nearly 80% in dollar terms of U.S. Imports last year.

Joe Biden, the U.S. president, has promised to revive American manufacturing through incentives to encourage domestic production of products to fight climate change. This includes solar panels and batteries for electric vehicles that are mostly made in China. Some of the smaller U.S. manufacturers in the solar industry say that they are struggling to compete against low-priced imported goods.

The American Alliance for Solar Manufacturing Trade Committee, in a complaint to Commerce that followed an earlier petition filed in April for the start of trade investigations, said that exports from Vietnam grew. The group represents several domestic producers, including Hanwha Qcells (a Korean company) and First Solar.

This investigation could result in high tariffs as early as in June if U.S. officials confirm unfair trade practices in preliminary decisions scheduled for early October and uphold retroactive duty applicable 90 days prior to their decision.

Requests for comments from the trade ministries of Vietnam or Thailand were not answered.

Vietnam could suffer the most from the new tariffs, as the United States consider it a non-market country. According to trade experts, this status often leads to more severe sanctions due to the unpredictable pricing in domestic markets.

The U.S. estimated Vietnam's estimated gap, also known as dumping margins (the difference between domestic and exported prices), at more than 270%, using Indonesia as a benchmark. This is three times greater than Thailand's. Experts said that higher margins would likely result in higher tariffs if they were approved.

The U.S. manufacturers have filed a complaint stating that the number of solar imports to the United States from Vietnam and Thailand increased by 39% and 17%, respectively, in the second quarter of the year compared to the first quarter. Both countries are alleged to have increased their shipments ahead of possible duties.

U.S. producers have said that such actions could be considered as "critical circumstances". The Commerce Department and International Trade Commission both must determine that there are critical circumstances before duties can be retroactively imposed. (Reporting and editing by Rod Nickel; Additional reporting by DevjyotGhoshal, Nichola Guarascio).

(source: Reuters)