TFT-LCD glass substrates are in tight supply

Austin, Tex. — TFT-LCD glass will continue to be in tight supply into the third quarter of 2009 as TFT-LCD panel makers increase capacity utilization and demand more glass substrate from suppliers, according to the latest report by DisplaySearch.

Glass demand increased to 18,958 square meters per month in the second quarter of 2009 up 26 percent Q/Q and much higher than the glass supply growth of 12 percent from first quarter 2009 to second quarter 09, according to the Quarterly LCD Glass Substrate Report.


This has created a tight supply situation and led TFT-LCD makers to call for increased allocations from their glass sources for the second half of the year, said DisplaySearch. In the second quarter of 2009, the glass glut ratio is 0.6 percent, which is far below DisplaySearch’s definition of balance point of 5-10 percent oversupply.

DisplaySearch said assuming that glass companies continue to bring more capacity on line in the third quarter, supply is expected to grow at 8 percent Q/Q; however, the glut ratio is still forecast to be below the balance point. DisplaySearch estimates that glass supply demand will reach a balance in the fourth quarter of 2009.

“The glass supply-demand balance in Taiwan has been different from Korea or Japan,” according to Tadashi Uno, director of materials and components market research at DisplaySearch and the author of the report, in a statement. “The economic crisis that hit in October 2008 impacted Taiwanese TFT-LCD makers the most, due to currency differences and customer relationships. In the fourth quarter of 2008 and the first quarter of 2009, TFT-LCD makers consumed glass inventory and reduced glass orders, especially Taiwanese panel makers, so glass makers stopped tanks to avoid losing money.”


Although TFT-LCD makers are ramping up production and are placing production orders with glass makers, it will take about one to two months to bring production online, said Uno.