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As the Chinese government is likely to announce the results of countervailing and anti-dumping preliminary imports of polysilicon in Europe, the United States and South Korea in the first quarter of 2013, Chinese solar PV companies hope to terminate long-term supply contracts with overseas companies. This indicates that the possibility of imposing punitive tariffs on imported materials is extremely high.
Chinese solar manufacturers point out that if punitive tariffs are between 20% and 60%, Chinese solar companies will be unwilling and unable to pay tax rates, even at the lowest level. Therefore, overseas material suppliers need to compromise on the contract.
If Chinese companies successfully terminate contracts and switch to local material suppliers, China's domestic material prices and market demand are likely to rise sharply. Overseas material suppliers pointed out that some contracts are likely to contain such provisions as “if the tax rate changes, the tax rate is flatâ€, which is actually beneficial to Chinese companies.
Solar manufacturers point out that the current spot price of polysilicon is about $17-18 per kilogram. The price of materials in most long-term supply contracts is about $40-50 per kilogram. If the final tax rate is 30%, then the incentive for Chinese companies to terminate their supply contracts will be very large.
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Some PV companies in China intend to terminate overseas polysilicon supply contracts
Abstract Some Chinese solar manufacturers hope to terminate long-term polysilicon supply contracts with overseas companies. Chinese solar manufacturers point out that if punitive tariffs are between 20% and 60%, Chinese solar PV companies must be unwilling and unable to pay tax rates, even the lowest level of tax...
Some Chinese solar manufacturers hope to terminate long-term polysilicon supply contracts with overseas companies. Chinese solar manufacturers point out that if punitive tariffs are between 20% and 60%, Chinese solar PV companies must be unwilling and unable to pay tax rates, even at the lowest rates. SMM News: Some Chinese solar manufacturers hope to terminate long-term polysilicon supply contracts with overseas companies. According to the company, when the company signs a contract, there is a shortage of raw materials in the market. Based on this, contract terms are often beneficial to suppliers.
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