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LCD panel prices stabilize

El Segundo, Calif. — The Japan disaster has stabilized overall pricing for large-sized liquid crystal display (LCD) panels in May and June, according to IHS iSuppli.

Average pricing for large-sized LCD panels fell only 0.5 percent in April, the smallest decrease during the previous nine months, while pricing in May is expected to drop by only 0.1 percent, according to the IHS iSuppli report.

“All told, the large-sized LCD panel market appears to be mired in a period of general uncertainty following the Japan quake disaster two months ago, with conditions characterized by diverging pricing trends for products in the different applications,” said Sweta Dash, senior director for display research at IHS, in a statement.

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For example, notebook panel prices are forecast to rise 0.2 percent in May after climbing 0.4 percent in April, while monitor panel prices will rise by 0.14 percent. Average television panel price is forecast to fall 0.6 percent for the month.

The report also indicated that consumer demand for LCD products such as TVs, monitors and notebooks remained weak in the first quarter with moderate sales, causing inventories to rise. However, name brands are starting to build up stockpiles as insurance against possible supply chain disruptions caused by the quake, said IHS.

IHS also noted that the Japan disaster could result in short supply of key components used in notebooks, monitors or flat panels, along with rising prices.

In addition, TV panel suppliers are expected to ask for price increases or at least to maintain currently pricing levels, said IHS. However, buyers are unlikely to accept any prices increases due to weak demand in the United States and Europe and because production has been impacted in Japan, according to the report.

Here is IHS iSuppli’s take on pricing trends in April and May:

  • TV panel prices fell 0.9 percent in April. Most television panel sizes fell by less than $5. Tags for panels sized 32-inch and larger dropped in the $1 to $2 range. For the 32-inch panels featuring full high-definition 1080p resolution, there is price gap of about $35 to $40 between products featuring the cold cathode fluorescent lamp (CCFL) technology used for LCD televisions, and panels featuring light-emitting diode (LED) technology for more advanced LED-backlit LCD TV sets.
  • Monitor panel prices will rise 0.14 percent in May on top of a 0.4 percent increase in April. Most monitor panel suppliers are quoting price increases of $2 to $3, but buyers are unwilling to buy more product and risk accumulating too much inventory. Certain monitor sizes — including the 18.5-inch wide LED, the 20-inch wide LED and the 21.5-inch wide LED — are reporting a $1 increase in pricing because of strong demand, which buyers are willing to accept.
  • Notebook panel prices increased 0.2 percent in April with an additional 0.2 percent increase expected in May. Branded vendors, faced with possible supply shortages of key components, continue to buy panels in order to meet their production plans, at the same time pulling into the second quarter production originally intended for the third quarter.
  • For netbooks and tablets, panel pricing is increasing. Tablet panel pricing is $60 to $70, depending on the panel technology being used.

IHS noted that some TV panel production has been impacted due to production cuts from a few Japanese fabs, such as the Gen 6 fab from Panasonic Corp., and the Gen 8 and 10 fabs from Sharp Corp. Many Taiwanese suppliers also are cutting their fab utilization rates due to weak demand.

Some Japanese fabs are expected to bring back production, while other panel suppliers will be ramping up Gen 8 fab capacity in May, said IHS.