Market researcher DisplaySearch yesterday raised its forecast for global demand for liquid-crystal display (LCD) panels this year, citing sustained strong demand for screens used in computers monitors and televisions, but it also said rapid capacity expansion would lead panel prices to fall further.
"Demand in the fourth quarter beat our expectations, especially for LCD televisions, so we have to lift our previous forecast," said David Hsieh (
Last quarter, large-sized LCD panel shipments rose 29 percent year-on-year to 38.7 million units, 4 percent faster than its expectations, the researcher said.
Strong demand
The robust demand is expected to continue into this year on rising shipments of laptop computers, LCD monitors and LCD TVs, Hsieh said.
As a result, DisplaySearch raised its projection for shipments of these electronics products by 4 percent to a total of 173.8 million units, up slightly from the previous projection of 167.7 million units the researcher previously projected, according to Hsieh.
That would represent almost 40 percent expansion annually, compared with 126.4 million units shipped last year, according to DisplaySearch.
Despite the solid growth in demand, Hsieh said panel supply was also increasing at a fast pace.
Panel supply would double to 206.4 million units this year from 138 million actually shipped last year due to the nonstop capacity expansion by major players and additional output from industry entrants, the researcher said.
Supply glut
That would represent about a 20 percent oversupply compared with the projection of 167.7 million units in demand, if all flat-screen makers hit their shipment targets for this year.
DisplaySearch is scheduled to release its latest forecasts on the panel supply and demand situation during a series of annual seminars to be held on April 7 and 8 in Taipei.
Rapid capacity expansion will drive panel prices down further this year, Hsieh said, without giving a specific prediction.
Over the past five quarters, prices for mainstay 17-inch LCD screens have tumbled 46 percent to US$153 per unit, according to DisplaySearch.
The collapse in prices resulted in huge losses for local flat-panel manufacturers last quarter, including top player AU Optronics Corp (友達光電).
It may not be easy for flat-panel makers to return to profitability.
DisplaySearch's president, Ross Young, predicted at a seminar in the US earlier this year that LCD panel makers would not be able to eke out profits until the second half of next year.
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