Solar Stocks Surge as U.S. Tariffs Lift Prices

Shares of solar energy companies jumped in early trading on rising prices in the U.S. market. Korean firms with local supply chains are expected to benefit as Washington tightens restrictions on imports of solar equipment from China and other countries.

Hanwha Solutions (009830) traded at 32,550 won as of 11:03 a.m. on the 28th, up 11.47% from the previous session, according to the Korea Exchange. OCI Holdings (010060) changed hands at 227,500 won, up 10.44%.

The rally in solar-related stocks reflects rising prices in the U.S. market. President Donald Trump last month signed a proclamation imposing a 15% tariff on polysilicon derivatives, a key raw material for solar products, under Section 232 of the Trade Expansion Act. The measure aims to block dumping of low-priced imports from China and other countries and to protect domestic U.S. production. Analysts expect the move to strengthen the pricing power of Korean companies that have built manufacturing capacity in the U.S. and reduced their reliance on Chinese supply chains.

Prices for solar equipment and components are already climbing in the U.S. ahead of the rules taking effect. Some 55% of suppliers on Anza, a U.S. procurement platform for solar and energy storage systems, have quoted prices that factor in Section 232, according to Hana Securities. The median price of imported modules stood at $0.27 per watt before the policy was announced last month, but quoted prices for deliveries after December 4 this year have risen about 41% to $0.38.

"The restructuring of the U.S. solar supply chain could deliver windfall gains to Korean companies that have built production facilities in the U.S. and moved away from China-centered supply chains," a securities industry official said. "As the price structure built around low-cost Chinese products is shaken, companies with production facilities in the U.S. could gain greater pricing power."