According to the liquid crystal display (LCD) price research report of IHS iSuppli Corporation, the decrease in the price of large-size LCD panels in August is expected to be slightly slower than in July, and suppliers' aggressive reduction in capacity utilization is expected to prevent further declines in panel prices.
As demand for large-size LCD panels from 10 to 55 inches continues to remain depressed, August prices are expected to decline slightly by 0.2% from July. The decline will be relatively less than the 0.3% in July, which is equal to the decline in May from April.
The current market situation shows that the main application areas of large-size panels are in weak demand, including applications such as televisions, monitors and notebook computers. As prices fell below the cost, profits in the first half of 2011 fell, and panel makers were reluctant to cut prices further. Brand manufacturers are unwilling to accept price increases and require suppliers to lower prices further during the negotiations.
Inventory is also a problem faced by panel makers. As demand for the panel fell in May, manufacturers reduced the plant's capacity utilization rate to 81% in June, 2 percentage points lower than the initial forecast. However, due to weak orders in July, panel inventory continued to rise, reaching an alarming level. TV panel inventory days exceeded 35 days, monitors were 33 days, and laptops were 31 days.
After August, capacity utilization is expected to improve, but the television panel market will continue to face uncertainties and will remain below 90%.
All kinds of panel markets are facing difficulties In all large-size LCD panel applications, TV panel prices will be the largest decline in August, is expected to drop 0.4%. The sluggish television sales in the second quarter, combined with the continued lack of vitality in the US and European markets, led to the increase in television panel inventory of branded companies in July to seven or eight weeks, which was about four weeks above the normal level.
Since the outlook for the third quarter is still uncertain, prices are expected to decline and will mainly occur on large-screen models and LED backlight panels. Unlike previous years, brands and channels have not yet established Black Friday and Christmas promotion plans, meaning that panel suppliers may still offer discounts, especially if they purchase a certain amount for Black Friday promotions.
On the monitor panel side, suppliers are distressed about how to increase orders, especially consumers are keen on tablet devices such as the Apple iPad. At the same time, the monitor brand's panel inventory still reaches four weeks, which is half a week to a week higher than usual, and requires panel makers to further cut prices. The monitor panel price will remain unchanged in August but will rise slightly next month.
Demand for notebook panels is also sluggish, but companies whose profits have fallen to very low levels are not willing to make concessions to buyers and further reduce prices. However, the third quarter of the promotion is being planned, taking into account the weak demand in May, especially in the European market, the 15.6 and 17.3 inch panels may offer special offers. Overall, the price of notebook panels in August is expected to decline by 0.2%, which is slightly more than 0.1% in July.
Sweta Dash is the Senior Director of Liquid Crystal Displays at IHS.
As demand for large-size LCD panels from 10 to 55 inches continues to remain depressed, August prices are expected to decline slightly by 0.2% from July. The decline will be relatively less than the 0.3% in July, which is equal to the decline in May from April.
The current market situation shows that the main application areas of large-size panels are in weak demand, including applications such as televisions, monitors and notebook computers. As prices fell below the cost, profits in the first half of 2011 fell, and panel makers were reluctant to cut prices further. Brand manufacturers are unwilling to accept price increases and require suppliers to lower prices further during the negotiations.
Inventory is also a problem faced by panel makers. As demand for the panel fell in May, manufacturers reduced the plant's capacity utilization rate to 81% in June, 2 percentage points lower than the initial forecast. However, due to weak orders in July, panel inventory continued to rise, reaching an alarming level. TV panel inventory days exceeded 35 days, monitors were 33 days, and laptops were 31 days.
After August, capacity utilization is expected to improve, but the television panel market will continue to face uncertainties and will remain below 90%.
All kinds of panel markets are facing difficulties In all large-size LCD panel applications, TV panel prices will be the largest decline in August, is expected to drop 0.4%. The sluggish television sales in the second quarter, combined with the continued lack of vitality in the US and European markets, led to the increase in television panel inventory of branded companies in July to seven or eight weeks, which was about four weeks above the normal level.
Since the outlook for the third quarter is still uncertain, prices are expected to decline and will mainly occur on large-screen models and LED backlight panels. Unlike previous years, brands and channels have not yet established Black Friday and Christmas promotion plans, meaning that panel suppliers may still offer discounts, especially if they purchase a certain amount for Black Friday promotions.
On the monitor panel side, suppliers are distressed about how to increase orders, especially consumers are keen on tablet devices such as the Apple iPad. At the same time, the monitor brand's panel inventory still reaches four weeks, which is half a week to a week higher than usual, and requires panel makers to further cut prices. The monitor panel price will remain unchanged in August but will rise slightly next month.
Demand for notebook panels is also sluggish, but companies whose profits have fallen to very low levels are not willing to make concessions to buyers and further reduce prices. However, the third quarter of the promotion is being planned, taking into account the weak demand in May, especially in the European market, the 15.6 and 17.3 inch panels may offer special offers. Overall, the price of notebook panels in August is expected to decline by 0.2%, which is slightly more than 0.1% in July.
Sweta Dash is the Senior Director of Liquid Crystal Displays at IHS.
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