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China Affirms Duties on U.S., Korean Polysilicon, Exempts Some

Jan. 20 (Bloomberg) -- China affirmed import tariffs on U.S. and South Korean polysilicon companies in a tit-for-tat response by the biggest solar-panel maker to American duties.

The final ruling upheld preliminary anti-dumping charges imposed July 18 on the material used in solar cells, while exempting Korean producers and some U.S. companies from lower anti-subsidy fees, the Ministry of Commerce said on its website.

The decision ends an investigation opened in 2012 after the U.S. imposed tariffs of as much as 250 percent on Chinese panels and the European Union began a similar probe. China imports most of the silicon it uses to make panels that have flooded the global market, cutting revenues for U.S. and European companies.

“The definitive tariffs are not much different from the preliminary ones,” Wang Xiaoting, a Beijing-based solar analyst for Bloomberg New Energy Finance, said today by e-mail.

The anti-subsidy tariff on Hemlock Semiconductor Corp., the biggest U.S. manufacturer of polysilicon, was cut to 2.1 percent from 6.5 percent, while OCI Co., the largest in South Korea, and Hankook Silicon Co. will benefit as they’re subject to tariffs of only 2.4 percent and 2.8 percent, respectively, Wang said.

The five-year anti-dumping duties range from 53.3 percent to 57 percent for the U.S. and 2.4 percent to 48.7 percent for Korea. U.S. operations of REC Silicon ASA and SunEdison Inc., formerly MEMC Electronic Materials Inc., are exempt from anti- subsidy fees of 2.1 percent imposed on other American companies.

Import Loophole

The duties haven’t curbed imports much so far as most of the silicon is shipped under so-called processing trades, Wang said. Companies able to prove the polysilicon they import is processed into panels for export can avoid the tariffs.

“If the processing trade loophole is closed, which is likely, the price of polysilicon will rise faster to a stable level, but not make a huge difference,” Wang said. The average spot price has risen almost 12 percent since November to $19.27 a kilogram as panel demand climbs, a weekly BNEF survey shows.

Chinese companies buy more than half the polysilicon they need from abroad. They imported about 72,100 metric tons last year, with 36 percent from Korea, 30.5 percent from the U.S. and 21.1 percent from Germany, unaffected by the tariffs. China’s largest polysilicon maker is GCL-Poly Energy Holdings Ltd.

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