U.S. to Investigate Wind Tower Imports from China, Vietnam

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Jan. 24 – The U.S. Department of Commerce (USDoC) announced last Thursday that it was launching a probe into the country’s wind tower imports from China and Vietnam, a move that could lead to an escalation of the clean energy trade disputes between the world’s two largest economies. The Chinese and Vietnamese wind tower producers may face steep anti-dumping duties if they lose the case.

The Wind Tower Trade Coalition – a group of U.S. wind tower companies including Broadwind Energy Inc. and DMI Industries – filed a petition last month and said it was seeking anti-dumping duties of 64 percent on imports from China and 59 percent from Vietnam.

However, in the official announcement by the USDoC, both China and Vietnam were alleged to have undercut U.S. wind tower prices by as much as 213.5 percent and 140.5 percent, respectively.

The U.S. producers are also accusing the Chinese government of imposing subsidies and are asking for additional countervailing duties on China-made wind towers.

A separate U.S. government agency, the International Trade Commission, held a hearing last Thursday to find out whether or not the wind tower imports have materially harmed or threatened the U.S. companies. The panel will decide next month whether there is enough evidence of harm for the case to proceed.

Following an ongoing USDoC’s probe into Chinese solar panel manufacturers, the new investigations add to the friction in clean energy trade between China and the United States. On January 21, the Chinese Ministry of Commerce issued a statement, saying the new move by the U.S. side will hurt Sino-U.S. cooperation.

“This investigation will not only be harmful to the development of Sino-U.S. new energy cooperation, it will harm the interests of the U.S. industry, and is not in line with global efforts on climate change and energy security.”

The United States had intended to strengthen its cooperation with China in the field of green energy development, but the Chinese manufacturers of wind turbines and towers, as well as solar panels, seem to be expanding so fast that they are beginning to threaten local U.S. companies. Wind tower imports from China amounted to an estimated US$103.6 million in 2010.

The U.S. producers also suffered a loss of orders from the Shepherds Flat Wind Farm, an 845-megawatt and 338-tower wind energy project under construction in eastern Oregon. Shepherds Flat is set to be the largest land-based wind farm in the world when completed in 2012.

Kerry Cole, president of U.S. tubular wind tower maker Trinity Structural Towers, said that all of the farm’s orders went to China and U.S. domestic producers are under tremendous pressure to cut prices.

“After losing this sale, domestic producers were desperate to fill their order books,” said Cole.

Michael Barczak, vice president of sales for DMI Industries, worries U.S. producers will continue to face “reduced business volumes, margins and reduced profits,” in the face of China and Vietnam threats. The current low production levels will likely lead to the shut-down of plants in the future if the U.S. government doesn’t take anti-dumping action.

Opposite to U.S. companies’ argument, some U.S.-based wind tower importers that hope to continue buying from Chinese and Vietnamese companies uttered different voices.

Christopher Hauer, director of Siemens tower operations in the United States, said that in addition to boasting the price advantage, Chinese and Vietnamese producers are also more reliable and capable of delivering in a timely manner.

“Domestic manufacturers have proved themselves unreliable and unwilling often to provide supply. Siemens cannot afford to be left without supply alternatives,” Hauer emphasized.

Max Schutzman, a lawyer representing Chinese and Vietnamese producers, points out that the petition contained “no real evidence” that the domestic companies had been materially injured or threatened with material injury by the imports.

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