Price Overview, 2H of Feb, 2008

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2008-02-20 18:05

Taiwan--(뉴스와이어)--Accroding to WitsView, in light of February's Chinese Lunar New Year holidays, the fewer working days resulted in January's panel orders to also take into account February's market demand. Thus, panel shipments are expected to drop during February. Although the severe snowstorm significantly disrupted the transportation networks in central China, according to WitsView's survey, the TFT module lines operated by the respective TFT LCD panel makers have only been slightly affected. Mere slight delays in the panel delivery time and component shipments have been witnessed. Meanwhile, based on WitsView's observation, 40% of Lite-On's China Dongguan plant capacity, which was damaged by a fire in early February, has been restored (original monthly capacity roughly 1 million). Currently, Lite-on is still in talks with clients regarding the production shortfall. As brand vendors, who directly handle the panel procurement, have maintained their original purchasing quota, the fire incident is expected to have little impact on the panel price.

Due to the slow seasonality, the oversupply pressure from the PC panel production has been temporarily eased by the stable TV panel demand and early inventory buildup by downstream vendors (a tight panel supply is anticipated in 2H08). Thus, the current panel price declines have mostly been caused by the weak seasonality. Monitor and NBs prices have continued to trend downwards in February. In the LCD TV segment, prices for the below 40" remain flat, due to a strong market demand. For the above 40", the impact from the seasonal slowdown has been stronger, thus dragging down prices.

Monitor Panel Price Update

With the Chinese Lunar New Year over, the more notable weak seasonality effect has resulted in prices to drop by another 3~5% in February. As demand for the traditional 4:3 (5:4) formats is even weaker, their price drops have been even sharper. The 17" and 19" slipped by an average of USD 5 to USD 123 and USD 142, respectively. In the wide screen segment, the serious 22W oversupply resulted in prices to dip by USD 6 to USD 161. The same situation is also seen for the 19W, where prices slipped to USD 124, down by USD 5. Meanwhile, as the 20W is USD 5~10 cheaper than the 19", replacement of the 19" continues. Due to its limited production output and increased demand, prices fell by USD 3 to USD 136.

TV Panel Price Update

As the 32W production output from the G7 and above continues, and the fact that CMO's new G6 has also started to ramp up in 1Q08, the sufficiency of demand and supply from the tight situation in last Q4 has become more balanced. On the other hand, the more acceptable price levels have helped spur a relatively strong market demand. Thus, panel makers merely adjusted the high average of the 32" from USD 335 to USD 333, down by USD 2. The average price of the 32" remains at USD 330. In the 37" segment, due to the limited production capacity of the G6, there were little fluctuations in the demand and supply. Prices have stayed unchanged at USD 450. By contrast, in the above 40" segment, due to the increased output from the G7 and above fabs, weak seasonality and slowing demand from China's local TV brand makers, the 46"/47"W may decline to USD 780 in February, down by as much as USD 10.

Notebook Panel Price Update

In 2008, panel makers plan to gradually shift their NB production from the below G5 to the G5 or even the G6, and also begin to introduce lower-cost LED backlit NB panels. Separately, the main reason behind the drop in the PC demand was attributed to the fewer working days and Chinese Lunar New Year holidays in February. Major NB OEMs only saw a slight 0.7% sequential growth rate in the production capacity. In terms of the current NB panel price trend, with the mainstream 14.1W experiencing a serious oversupply, prices tumbled by USD 3 to USD 98. Meanwhile, as the 15.4W and 17W continue to replace the PC desktop, prices respectively edged down by USD 2 to USD 102 and USD 124. Finally, strong demand for the 13.3W resulted in prices to drop by only USD 1 to USD 112.

Conclusion

The impact from the weak seasonality is projected to be most severe during February. Market demand has weakened, due to the fewer working days and Chinese Lunar New Year holidays. However, the panel supply continues to increase, resulting in the production utilization rate to stay at full capacity. As predicted by WitsView, after panel prices began to drop since the end of 2007, the start to the Year of the Rat has been marked by higher price pressures on PC panels. Although the below 40" TV remains strong, temporarily consuming some of the extra capacity originally allocated for PC panels, the demand for the above 40" segment has been much weaker. Meanwhile, as the increased 32W supply will negatively affect its future price trend, it is worthy to see how the panel prices develop in March, as they will serve as a key indicator of whether a market rebound will occur in April.

Finally, the subprime mortgage crisis, fluctuating oil prices and inflationary pressures are all factors that could take a toll on the world economy. According to the US consumer index, released by the US Conference Board, the figure fell from 90.6 in Dec07 to 87.9 in Jan08, a signal that consumers are still wary about the future economy.

웹사이트: http://www.witsview.com