Chinese exports of solar cells and panels dropped in July as the removal of the local export tax rebate as of April 1 continued to depress exports for the third straight month.
China’s solar equipment exports declined by 21.4% last month from a year earlier, according to Chinese customs data cited by Reuters on Tuesday.
The world’s top solar panel and cell manufacturer scrapped, effective April 1, 2026, export tax rebates for the value added tax (VAT) of photovoltaic products, including solar cells and panels. China will also withdraw the export tax rebate on battery products, effective January 1, 2027.
The move was welcomed by China’s domestic solar manufacturing industry. The China Photovoltaic Industry Association has said that the measure would help restore “rational pricing in foreign markets and reduce the risk of trade frictions for China.”
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The Chinese tax policy change was widely expected to slow solar exports from April 2026 onwards, as the policy raises export costs and makes Chinese PV products more expensive internationally.
China’s solar exports surged in March ahead of the April 1 deadline, amid soaring demand for clean energy in south and Southeast Asia as the oil supply shock at the Strait of Hormuz drove increased solar power installations.
Chinese solar exports hit a record-high of 68 gigawatts (GW) in March, double the February export volumes, due to the spike in energy prices and an additional boost from changes to Chinese tax rebates, data analyzed by Ember showed in April.
Despite the decline in Chinese solar exports since May, shipments to Africa, Southeast and South Asia have continued to grow this summer amid high demand in these markets.
Total Chinese solar exports still fell by 9% in June from a year earlier, but shipments to Southeast Asia jumped by 33%, exports to Africa surged by 26%, and exports to South Asia increased by 12%.
Meanwhile, exports to Europe, China’s top market, fell by 18% and those to the Middle East crashed by 38% in June.
By Charles Kennedy for Oilprice.com
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