CITIC construction securities has released a report stating that the anti-dumping and countervailing measures in Southeast Asia are still pending, and the entry barriers for US solar products are gradually increasing.
On May 15th, the US Department of Commerce announced the initiation of anti-dumping and countervailing duty investigations on crystalline silicon solar cells from four SEA countries. The preliminary ruling tax rate for anti-dumping/countervailing will be announced around Sep. 23rd/Oct. 1st. Due to limited domestic cell supply in the USA, the prices of American PV products are expected to remain high.
Rely on imports
The solar modules in the USA mainly rely on imports and domestic manufacturing.
Since 2022, the export of cell modules from four SEA countries to the USA has accounted for 70-85% of the total US imports, and by 2023, the combined proportion of the four countries reached 75.7%. Under the IRA subsidy, investment in the domestic industrial chain in the USA is on the rise, and the expansion is concentrated in the module sector. By the end of 2024, the US module production capacity is expected to reach 68GW, which can meet local demand. At the same time, due to the additional 10% ITC tax credit for domestically manufactured modules in the USA, manufacturers will prioritize using domestically produced module products.
Cell production capacity gap
Overseas cells are scarce, and during the expansion of domestic module production capacity in the United States, cell supply is relatively insufficient.
According to data from PV InfoLink , as of the end of 2023, the domestic PV cell production capacity in the United States was only 0.3GW. It is expected that the domestic cell production capacity in the USA will be about 7.3/32.7GW in 2024/2025, which is a significant supply gap compared to the 57.8/68.5GW crystalline silicon module production capacity. Therefore, imported solar cells are needed to make up for the production capacity gap. However, excluding the cell production capacity of four SEA countries and China, the global cell redundancy capacity is limited. It is expected that the cell redundancy capacity will be about 15.6 GW and 17.8 GW in 2024/2025.
If the anti-dumping measures are implemented, the scale of cell modules exported from SEA to the USA is expected to decrease, and US terminal developers may import from other countries. But currently, outside of the four SEA countries, the cell production capacity is smaller than the module production capacity. It’s expected that overseas cell production capacity may become a major bottleneck for future exports to the US market.
Manufacturer dynamics
Due to the shortage of cell supply in the USA, the prices of American PV products are expected to remain high.
At present, manufacturers are actively promoting the construction of production capacity in the USA. According to announcements from various companies, Trina Solar’s 5GW module production capacity in the USA and 1GW cell module production capacity in Indonesia are under construction; Longi Solar’s US 5GW joint venture factory has been put into operation in the first quarter of this year; JinkoSolar is expected to start production of 2GW of US module capacity by the end of 2024; JA Solar’s 2GW module production capacity in the USA is expected to be put into operation this year.
In addition, top manufacturers such as JinkoSolar, Trina Solar, and TCL Zhonghuan are actively expanding their production capacity in the Middle East.
