TrendForce Reports Greater Flexibility in TV Panel Price Dealings as Chinese New Year’s Production Cut Has Limited Impacts on Panel Sufficiency

The newest panel price report from WitsView, a division of TrendForce, indicates that Chinese New Year had some effects on panel module production and reduced pressures on the supply side in February. However, the extent of positive support on panel prices driven by the holiday period has been quite limited. Demands for notebook and monitor panels in particular have been weaker than expected, and consequently IT panel prices are in a general decline. Demands for TV panels have been steady compared with IT panels. While the prices for TV panels sized 60 inches and above have kept falling, quotes for other panel sizes are becoming more flexible with wider price ranges. 

According to WitsView’s Senior Research Director Eric Chiou, the prices for mainstream TV panels have remained more or less constant in February, but there have been significant fluctuations in the 32-inch market. Chiou explained, “With the Chinese companies in lead, panel suppliers intend to increase their scales of production for the 32-inch panel this year in order to boost their margins and reduce excess production capacities.” As the market responds to this news, worries about 32-inch panels in short supply have gradually receded and are replaced with ongoing and more flexible price negotiations. The present condition is not yet set for an overall price drop for the 32-inch panels, but WitsView forecasts a turnaround in the market in the near term. Another panel size that is worth paying attention to is the 55-inch. With three new Gen 8.5 production lines entering service in the second quarter, the market anticipates an increase in supply. Though price quotes for 55-inch panels have stayed constant this month, different suppliers expect price-reduction pressure to grow and are preparing for a more flexible and demanding negotiating environment. 

Monitor panels are facing weak demands, and excess panel production capacities have been shifted from notebook and TV applications to monitor during the product mix adjustment process. Therefore, prices will remain weak due to oversupply. Among the mainstream monitor panel sizes, the 21.5-inch has the weakest performance this month with the projected price drop-off range between US$0.8 and $0.9. In addition, the price drop-off range is between US$0.4 and $0.6 for other sizes, including 19.5-inch, 20-inch, 23-inch and 23.6-inch panels. This is due to the fact that a few among the numerous suppliers can create a knock-on effect in the market by offering competitive prices. 

American notebook brands are again revising their shipment volume downward, and WitsView anticipates worldwide notebook shipments in 1Q15 to fall sharply by 20% compared with the previous quarter. This decline in shipments will not only directly impact panel purchasing volume, but it will also prolong the time needed to consume the stock carried from the previous quarter. According to Chiou, the 15.6-inch widescreen notebook panel, which has the largest trade volume, will see a price drop of US$0.7, and the 14-inch widescreen will see a drop ranging from US$0.5 to $0.6. Panels of other sizes will see a price drop of just over or under US$0.5, which is comparable to the previous month. The trading of notebook panels based on projects and contracts continues to be strong in the current market, with buyers and sellers negotiating behind closed doors instead of following the market prices.