Solar Module Imports from China Surging

Solar module imports from China in 2020 were 100 times larger than Korea’s solar module exports to China.

Solar modules imported from China between January and November in 2020 were estimated at US$317.31 million, said the Korea International Trade Association (KITA) on Dec. 28. Korea’s imports of Chinese solar modules reached US$367.53 million in 2019, up 67 percent from US$219.52 million in 2018. Industry experts expect this year’s import amount to be similar to the previous year’s.

On the other hand, Korea’s solar module exports to China during the same period stood at a mere US$3.4 million.

In terms of weight, Chinese module imports amounted to 80.17 million kilograms between January and November in 2020. But Korean modules exported to China stood at 1.58 million kilograms, only one fiftieth of the Chinese modules imported by Korea.

Prices explain the big difference in the two figures. Chinese companies with manufacturing costs far lower than Korea are expanding their exports to Korea through a price war. On top of that, unlike the U.S. and India which regulate Chinese products to protect local companies, Korea has no barriers against Chinese imports, making it easy for them to penetrate the Korean market.

As sales of Chinese products have expanded in Korea, the proportion of Korean cells in solar modules has also been cut to around 20 percent. This is due to an increase in Korean companies’ demand for relatively cheap Chinese cells as profitability deteriorated due to a drop in the prices of renewable energy certificates (RECs).

In response, the Korean solar energy industry is calling for measures to enhance Korean companies' competitiveness in manufacturing. In other words, it is quite difficult for Korean companies to increase their market share under high labor costs and corporate tax.