China and the United States have signed a Phase 1 trade deal that signals a rollback in the back-and-forth tariffs between the countries, according to the U.S. Chamber of Commerce. Solar inverters are part of the $200 billion of Chinese imported goods tariffed at 10% that started in September 2018. Trump threatened to raise those tariffs by 25% at the start of 2020, but held off due to the start of negotiations with China. Solar Power World cannot yet confirm if now Chinese inverters are excluded from being taxed. Solar panel tariffs are global and separate from the 10% Chinese tariffs.
“We commend both governments for staying the course and taking this important step to rebuild trust and restore some stability in the world’s most important commercial relationship,” said U.S. Chamber CEO Thomas J. Donohue. “This deal provides much needed certainty to American businesses as they begin the new year.”
CNBC reports the deal includes a commitment by China to buy more U.S. agricultural products and a promise by the United States to cancel or reduce some tariffs.
“This agreement signifies a new chapter in U.S.-China relations. When fully implemented, China’s commitments will create a better environment for U.S. exporters and investors and begin the process of rebalancing the economic relationship between the United States and China,” said Donohue. “We hope this deal will usher in a new era of trust between both countries and pave the way for Phase 2 negotiations to begin in a timely manner.”
SEIA released a statement applauding the agreement and its affect on U.S. polysilicon manufacturers. REC Silicon manufactures polysilicon, the main component in solar cells, in the United States but had to shut its $1.7 billion plant in Washington State after China shut out U.S. imports. Polysilicon is one of the materials that China will now buy more of from U.S. suppliers.
“While this trade deal won’t do anything to relax the solar tariffs, it is a positive development for the U.S. solar industry,” said John Smirnow, VP of market strategy at SEIA. “Polysilicon is the building block of most solar cells on the market and these changes are a great development for American manufacturers who have been hit hard with Chinese duties on their products. Credit to the Trump Administration for cutting a deal that gives relief to U.S. polysilicon production companies. We hope this deal will start a much-needed discussion with the administration about how we can scale back the tariffs on solar products more broadly, while continuing to build American solar manufacturing.”
Erik M Hellebuyck says
https://www.wnem.com/news/hemlock-semiconductor-lays-off-50-employees/article_a03e5ccc-b178-11ea-b6d6-d3167861abca.html
Solarman says
“We hope this deal will start a much-needed discussion with the administration about how we can scale back the tariffs on solar products more broadly, while continuing to build American solar manufacturing.”
American “manufacturing in general”, has the onus of the EPA, FDA and other heavy weight mandates that China pretty much ignores. There are those who like the “right or wrong” argument and take the ‘righteous’ path regulated emissions, from burning to catalyzing to formulating products for public consumption. It is all a cost adder to the end product, that makes the U.S. less productive than China. One factory in China had a problem with employees jumping from upper stories to their deaths below. The “fix” put nets around the complex and catch the bodies before impact. Foxconn has been called out more than once, while it churns out the World’s I Phones for consumption.
The business school practice of min/max is becoming more important now than ever. Bringing online more automated manufacturing lines with less human interaction needed can increase throughput with less cost adders to every product. Let’s face it, people have a useful “shelf life” in the workforce. The more labor intensive the more expensive. Energy costs are being managed by using alternative energy systems in commercial and Industrial settings. The less energy one needs to purchase to make a product, the more that item can be sold for a profit and still be cheap enough to compete. Problems within the electric utility industry pushing back against technology that not only can control manufacturing energy costs, it can also leave money in the coffers to upgrade, expand, add new product lines is becoming a point of anxiety. Even small moves like installing behind the meter energy storage that can use arbitrage to address electric rate spiking and demand charges also makes the manufacturing plant more efficient in the energy it does use from the grid. Politics aside, the technology is available to make the entire process less costly in labor and energy use. This is a more predictable remedy than waiting for the “political will” to supply the means.