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Prices for TV-use LCD panels are likely to reach a low point at the end of the first quarter of 2022 and will begin to stabilize in the second quarter.
This is because prices for TV-use LCD panels have continued falling since mid-2021 and decreases in price have recently slowed down; furthermore, global supply of such panels is considerably constrained because Samsung Display, LG Display, and Taiwan-based makers have shifted portions of production capacities for such panels to production of IT-use LCD panels.
Global demand for LCD TVs was rising a great deal in the first half of 2021 due to the coronavirus pandemic but began to fall in the third quarter of the year. According to China-based Sigmaintell Consulting, 232 million TVs were shipped globally in 2021, decreasing 7.1% on year, and the shipments will further slip 3.1% to 225 million units in 2022. Accordingly, 260 million TV-use LCD panels were shipped globally in 2021, a decline of 2.3% on year; shipments in 2022 will further drop 3.1% to 252 million panels.
China-based BOE Technology, China Star Optoelectronics Technology (CSOT), and HKC have become the three largest LCD panel makers in the world. While China-based makers have not set up additional production lines for TV-use LCD panels in the past few years, they are expanding production capacities of existing production lines for such panels; for example, HKC is expanding production capacity of its 8.6th-generation (8.6G) line; BOE, CSOT, and Sakai SIO Display Technology are similarly expanding production capacities of 10.5G lines.
Consequently, the global effective production capacity for TV-use LCD panels in 2022 will grow 8.1% on year, while the corresponding global demand for TV-use LCD panels will increase 4.4%, implying possible oversupply.
As prices for TV-use LCD panels are expected to stabilize beginning in the second quarter of 2022, oversupply risks will shift to IT-use LCD panels in 2022. This is mainly because main panel makers have been shifting portions of TV-use LCD panel production capacities to production of IT-use LCD panels and, as a result, global supply of IT-use LCD panels for 2022 is estimated to exceed the corresponding demand by about 10%.
On the other hand, global demand for notebooks and LCD monitors in 2022 is expected to shrink from 2021 after large growth in 2020 and 2021 and vendors of these products have been under pressure of adjusting inventory levels to cope with congested logistics operations at many harbors around the world. This will lead to decreased demand for IT-use LCD panels in 2022.