Smith Market Intelligence - LCD

Monday, 06 July 2009 09:46

Full Issue

GLASS SHORTAGE:

AUO and CMO are expecting a glass substrate shortage which could lead to higher panel prices in the third quarter. Other panel manufacturers also confirmed a 20-30% gap between glass substrate demand and supply. LCD panel prices have steadily risen since February, due to Chinese TV demand and some module component shortages. A substrate shortage would further increases prices with the biggest impact expected in Q3. June's higher prices (+20%) are directly related to this anticipated shortage.

There are some concerns about oversupply in the second half of 2009 if demand does not continue to increase or the glass substrate shortage does not materialize. A similar downturn was observed in 2008, when consumers cut back on their traditional back to school and holiday purchases. But LCD manufacturers confirm they are already feeling the effects of the glass shortage. Their glass makers indicate it will take at least two months to bring back enough capacity to fulfill forecasted requirements, and another two months to fully catch up on backlog. If this bears out, prices should continue to rise through October 2009, possibly another 20-25%.

BACKLIGHT TECHNOLOGY:

The typical LCD backlight can be one or more cold cathode fluorescent lamps (CCFLs) or an array of light-emitting diodes (LEDs). The LED technology is becoming more popular on laptops. As manufacturers increase production on LED backlights, they allocate less capacity to the CCFL models used predominately in repair. This shortage of capacity, combined with the glass substrate shortage, could cause severe supply issues in Q3/Q4.

CURRENT SPOT SHORTAGES:

15.4 glossy AUO

14.1 glossy ALL MFG

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