US considers tariffs and a price floor for polysilicon to counter China's solar and chip industry

According to four people familiar with the plan, the 'Trump administration' is planning to set a price floor for polysilicon, and to impose tariffs. This will put a material that is critical for solar panels and semiconductors in the forefront of U.S. efforts against China to compete on artificial intelligence and energy.

The decision is expected later this month and aims to protect U.S. Polysilicon?factories that are owned by Hemlock Semiconductor or Wacker Chemie against growing Chinese ambitions within the?chip supply chains. Hemlock is a joint venture between Corning, Japan's Shin-Etsu Handotai and Shin-Etsu Handotai, which owns a Michigan-based plant.

According to anonymous sources familiar with the administration's deliberations and discussions, the administration will likely pursue a hybrid policy that combines a?minimum import price? with tariffs on derivative products such as polysilicon.

Sources two and three said that the plan would allow importers to offset costs associated with trade protections by investing in U.S. cell and wafer production. China is responsible for 80% of the global solar manufacturing capacity.

An official at the White House refused to comment before President Donald Trump made his decision. The Commerce Department has not responded to a request for comment.

The Chinese Embassy in Washington has criticised the trade investigation.

A spokesperson stated that "China urges U.S. to end the Section 232 Tariff Measures as'soon as is possible and resolve the 'concerns for all parties by equal dialogue",

The Trade Expansion Act, Section 232, allows the president to limit?imports that are deemed a danger?to the national security. Trump has used his authority in the past to impose tariffs, including on steel, autos, and semiconductors. (Reporting and editing by Nick Zieminski, Lisa Shumaker, and Nichola Groom)

(source: Reuters)