LCD Panel Pricing on the Rise

Prices for LCD panels with a size greater than 10 inches is believed to have climbed in June, despite continued weak consumer demand.

According to IHS iSuppli, the problem is still the impact of a disruption of manufacturing in Japan. The market research firm said that June prices climbed by average about 0.2%, the first time all three major segments - desktop, notebook and TV - experienced an increase in prices in 14 months. Desktop displays were up 0.1%, TV LCDs 0.2% and notebook displays 0.5%. While these increases seem to be moderate, iSuppli noted that they are average numbers and that there have been considerable increases in some individual segments (which were not mentioned.)

The company stated that there is an expectation of improving sales due to the preparation for the back-to-school and holiday shopping season, but there seems to be an uncertainty just how much positive effect those events will have. Inventory levels are up

“Consumer demand for the major products using LCD panels, like televisions and computers, remains weak, especially in the United States and Europe,” said Sweta Dash, senior director for liquid crystal displays at IHS. “Despite this alarming sales situation, pricing is on the rise for all of the major LCD applications with panel buyers replenishing their stockpiles in order to build buffer inventory, in case of further supply disruptions spurred by the Japan disaster, and as panel suppliers reduced utilization rates to control production. This is driving up pricing for panels in all major applications.”

However, iSuppli also noted that the primary concern for the LCD market remains "the sluggish state of demand among consumers in the United States and Europe." Apparently, demand is low enough to provide a compelling reason for manufacturer not to return to full production quickly and prompt LCD vendors to lower their sales forecasts overall.

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