China-based solar firms who have been suffering have been accusing international firms of dumping polysilicon into China's domestic market.
Among China's solar supply chain, about 90% of polysilicon firms have suspended operations. Except for tier-one vertically integrated firms such as Suntech, Yingli Solar, Canadian Solar, Trina Solar, JA Solar, and Jinko Solar, most tier-two and tier-three firms have capacity utilization rates below 50%. Firms with strong competitive advantages such as producers of mono-crystalline solar products have been running at high utilization rates.
According to industry sources in China, a large fraction of solar firms in China shut down production in first-quarter 2012. Some newcomers who are close to exiting the market have been struggling. To fend off foreign competition, players in China's supply chain have been filing complaints to the government accusing solar firms from the US and South Korea of dumping polysilicon.
Newcomers that were attracted by the prospect of the solar market got hit the hardest. Once the firms installed equipment, market conditions turned downward. Solar firms began to fight for orders through low prices. But many newcomers who lack the reputation and ability to engage in price competition have bene hit by growing losses.
Industry sources noted that some firms are hoping to sell equipment and plants, but since the market has been hit by oversupply, it has not been easy.
To make things worse, Europe and India are likely to follow the footsteps of the US government to begin an investigation against China-based solar firms on dumping and subsidy issues.
The solar supply chain in China has been swamped with hot money and newcomers. To control the oversupply situation, the China government has been weeding out firms that lack competitive advantages by demanding solar firms increase conversion efficiency of products coupled with export tariffs.
Venting stress toward international firms have been seen as China-based solar firms taking the last charge before giving up.
China solar firms want government to build up industry protection
Photo: Digitimes file photo
Article translated by Jackie Chang
