Liquid-crystal-display (LCD) panel makers could increase prices by nearly 8 percent in the second half of this month as a component shortage is intensifying ahead of back-to-school demand and strong TV replacement demand in emerging markets like China, US market researcher DisplaySearch said in its latest report.
An unresolved panel shortage, primarily the result of insufficient supply of glass substrates, could make room for the world’s major panel makers, especially those from Taiwan, to raise prices more aggressively as they hoped to end several quarter losses in the July-to-September period, the Austin, Texas-based researcher said.
LCD panels are used in PC monitors, notebook computers and slim-screen TVs. For a mainstay 32-inch TV panel, the price for a panel is expected to climb by US$15, or 7.7 percent, to US$210 per unit in the second half of this month from the first half, when the price increase was only 2.6 percent, DisplaySearch said.
To cope with a severe industrial downturn from to glut and a bleak economy, major panel makers and component suppliers have more than halved their output. But with the recovery seen recently, manufacturers found they were unable to restore production fast enough to meet a sharp rise in demand for flat panels.
“TV panel supply still cannot meet demand. Demand from China remains strong and the component supply shortage limited TV panel supply availability in July,” DisplaySearch said.
Demand in Europe and North American, the world’s biggest TV markets, however, was showing new signs of slowing and could cause excessive inventory, the report said.
Even so, DisplaySearch said prices of flat panels used in notebook computers continued to rise.
“Some top tier brands want to secure panels to prepare for seasonal demand, so they are willing to pay more to get enough allocation,” the researcher said.
A 15.4-inch notebook panel and a 19-inch monitor panel is expected to see prices rise 7.4 percent and 8.1 percent to US$58 per unit and US$80 respectively in the third and fourth weeks of this month, compared with the first two weeks, the report said.
The world’s biggest glass substrate supplier, Corning Inc, last week raised for the second time its projected output in the second quarter, saying its quarterly output had doubled from the first quarter rather than increase by 75 percent as previously forecast. The forecast did not include Corning’s glass venture with Samsung Electronics Co, Samsung Corning Precision Glass Co Ltd.
But the shortage of glass substrates could remain a handicap to increased panel production and continue pushing panel prices go higher, a situation both AU Optronics Corp (友達光電) and Chi Mei Optoelectronics Corp (奇美電子) said recently might persist into September.