On November 25, local time, U.S. President-elect Trump posted on his social media account, falsely claiming that a 10% tariff will be imposed on all goods imported from China. Furthermore, he will impose a 25% tariff on all goods from Mexico and Canada on his first day in office.
According to reports, Trump posted on Truth Social, saying, “On January 20th next year, as my first executive order, I will sign all necessary documents to impose a 25% tariff on all Mexican and Canadian goods entering the United States.”
Trump also stated that the tariffs will not be lifted unless the two countries take action to combat drugs, especially fentanyl, and prevent illegal immigration across the borders between the two countries and the United States.
Trump’s high-profile announcement of the tax increase was actually foreshadowed. In an interview last year, Trump proposed a 10% general tariff on all imported goods. During his presidential campaign, Trump stated that he planned to impose a 60% tariff on China. Industry insiders have analyzed that if the tax increase decision is officially implemented, this 10% increase will only be the beginning.
If Trump continues to impose additional taxes in the later stages, it will inevitably increase product prices for PV exports and may even force some companies to eventually withdraw from the U.S. market.
It is noteworthy that Trump’s tax increase plan is not only aimed at China but also includes a more severe tax policy for neighboring Mexico.
From Trump’s statement, it appears that the United States will impose a 25% tariff on all products entering the U.S. from Mexico and Canada. This means that PV products transiting from Mexico to the U.S. market will also be taxed.
Coincidentally, just before Trump announced the tax increase, Brazil in South America also announced an increase in import tariffs on November 15.
According to the Brazilian Ministry of Development, Industry, Foreign Trade, and Services (MDIC), the import tariff for PV modules has been increased from 9.6% to 25%. However, unlike the United States’ targeted approach, Brazil’s increase in import tariffs applies to imported products from all countries.
It is understood that this is the second time Brazil has increased the tariff rate for modules in a year. However, Brazil’s high tariff rate of 25% only applies to “quota-exceeding PV modules.” The Brazilian market implements a quota system for PV modules and core components, and PV modules within the quota will remain at zero tariff until June 30, 2025. According to the new quota allocation method formulated by the Brazilian Foreign Trade Secretariat for imported PV cell modules in June 2024, the initial quota cap for each company is $10 million.
Since August 1, 2020, the Brazilian government has implemented a “zero tariff” measure for the import of 101 types of solar component products manufactured in foreign countries, including PV modules, inverters, and solar trackers. This move has led to a flood of PV module manufacturing factories from around the world entering the Brazilian market. China has overwhelmingly occupied over 90% of the market share. According to relevant personnel, Brazil’s tax increase is mainly aimed at reducing import dependence and digesting inventory.
In recent years, the trend of PV exports has gradually spread, especially under the premise of extreme domestic market competition in the past two years. More and more PV companies have chosen to go overseas, and their overseas expansion models have also changed with market conditions.
From the initial export of PV products to overseas investment and construction of factories, from production in Southeast Asia, the Middle East, and South America to supply to Europe and America and local sales, it can be seen that China’s PV exports are also undergoing rapid changes.
Over the years, the United States has been trying to reduce its dependence on imports of Chinese PV products and vigorously support the development of local renewable energy enterprises.
According to the latest report (Solar Means Business) from the Solar Energy Industries Association (SEIA), companies across the United States are investing in record levels of solar and energy storage to power their operations.
By the first quarter of 2024, Meta, Google, and Amazon had added the most solar projects to their electricity portfolios and had the largest pipelines of new solar procurement contracts. Meta maintained its position as the largest corporate solar user with nearly 5.2 gigawatts (GW) of installed capacity, while Google became the leading energy storage user with 936 megawatt-hours (MWh) of battery installed capacity. Major manufacturers such as General Motors, Toyota, and U.S. Steel also ranked among the top ten companies with new solar contracts.
Furthermore, as of the first quarter of 2024, U.S. businesses had installed nearly 40 GW of on-site and off-site solar capacity. Total corporate energy storage usage exceeded 1.8 GWh, and more than 3 GWh of battery storage is expected to come online in the next five years.
As electricity demand skyrockets to keep pace with the growth of data centers, technology companies have become the leading industry in investing in solar energy. Amazon leads the nation with 13.6 GW of solar contracts, while Meta and Google each have nearly 6 GW of contracted installed capacity.
In 2023, China’s PV module exports amounted to approximately $39.61 billion, with an export volume of 211.7 GW. Among the export markets, Europe was the most significant export market for PV modules, accounting for 50.2% of the total export value, followed by Asia at 27.7%.
Considering the current international market conditions and the supply-demand situation of PV manufacturing, the trend of PV exports will continue next year. However, changes will come to the export market landscape. Besides the European and American markets, the market demand in Southeast Asia, the Middle East, and other regions will also increase.
