Large-sized panel market in limbo

Due to the production cuts in Q3 and stocking for the expected Q4 uptick, large-sized panel prices have stabilized. This is according to WitsView that also revealed that panel makers have increased their utilization rates to improve production cost. As such, financial losses among panel makers can be trimmed down in Q4.

By the end of December, the market demand for LCD TV, monitor and NB panels will have slowed down, coinciding with the completion of downstream manufacturer’s stocking, said Jeffy Chen, WitsView research manager. However, with the January working days next year to be reduced due to Lunar New Year Holidays, downstream manufacturers have looked into increasing stocks by the end of this year. It would be alarming if the increased utilization rate and supply side sustain until Q1 next year, there could be potential risk of increased panel inventory and supply-demand imbalance, pushing the panel price downwards again. The result would not be conducive to the financial performances among panel makers in 1Q12.

According to the latest investigation reports on large-sized panel shipment in November published by WitsView, the large-sized panel shipment in November reached 58.37 million units with MoM regression of 1.6 percent and YoY growth of 0.2 percent.

LCD TV market, under the positive effects of stocking activities for Christmas and Lunar New Year Holiday promotions among downstream manufacturers, the total shipment of TV panel has come to 18.74 million units with MoM growth of four percent. In the November shipment report, the shipment of 39-inch panel first introduced by CMI has increased 10 times compared to previous month, while 50-inch panels are also starting to be shipped in small quantities.

The market acceptance of TV products of new sizes during the Lunar New Year promotion in Mainland China should be closely monitored. The total shipment of monitor panel reached 15.92 million units with MoM growth of 4.3 percent, and the shipment of NB panel has reached 16.69 million units with MoM growth of 9.5 percent. As for tablets, with Apple’s continuous control over iPad2 inventory and the supply of new generation iPad3 limited due to yield issue, the shipment of 9.7in panel has been sliding greatly leading to the MoM regression of overall tablet panel shipment by 42.8 percent coming down to 4.95 million units. The shipment of netbook panel has come to 2.07 million units with MoM regression of 3.6 percent.


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Chart 1: TFT-LCD Panel Shipment in Nov-11 (K units)
Source: WitsView