EnergyTrend, green energy research division of TrendForce, and SNEC, the organizer of the world’s largest solar industry exhibition jointly hosted EnergyTrend PVforum 2014 at Kerry Hotel in Shanghai on May 21, 2014 EnergyTrend’s analysts offered in-depth analyses, covering important issues within PV and energy-storage industries Below is the summarized content:
Distributed PV is an important future demand source for the Chinese market, will affect global supply chain development
Global PV installation continued to increase in 2014 Aside for large demands from utility-scale power plants and residential systems; expanding distributed PV systems, ranging from several thousand to a couple million watts, have also become an industry focus that is leading and motivating the foreign solar market
“Global PV demand is 466GW in 2014, in which, Chinese market has the fastest growth In just two years, China’s demand increased from 1GW to more than 10GW to becoming the largest PV market in the world,” said Jason Huang, research manager of EnergyTrend
China is devoted to the development of distributed PV systems mainly to utilize solar power more efficiently Solar plant power capacity in 18 pilot projects installed in 2013 amounted to 749MW and is expected to soar 243% to 1823MW in 2015 Although, China is still exploring promotion, construction, operation, and investment strategies for distributed PV systems, Huang noted distributed PV is still an important future demand source for the Chinese market The system will also impact global PV supply chain development
Wafer price will remain stable in 2Q14, while polysilicon oversupply may occur in 2H14
The recent demand spike is due to the postponement of the US-China anti-dumping and countervailing preliminary ruling to July 24, 2014 In addition, China increased shipment demands, while Japan’s shipments remained high, the Europe’s economy also recovered Based on the uptrend of manufacturers’ monthly revenues, wafer prices will likely be stable in 2Q14
“High-efficiency wafer price will remain at above US$ 10/piece in 2Q14, while mono-si wafer price, with relatively stable supply and demand, will fall between US$12-125/piece,” said Arthur Hsu, research manager of EnergyTrend
Looking into the future, new capacities of polysilicon and module will enter mass production stage in 2H14 In addition, various relevant policies will become clearer including the US-China anti-dumping and countervailing results, which might trigger polysilicon oversupply Moreover, new market demand changes will also affect the price trend in 2H14
CAGR of solar energy storage using lithium battery market will reach 75% from 2014 to 2020
As countries continue to promote energy policies related to sustainable development, energy-storage market demand has increased “The general solar energy storage using lithium battery market will increase from 180mWh in 2014 to 5gWh in 2020, with a CAGR of 75%,” said Duff Lu, research manager of EnergyTrend
Japan began issuing residential energy-storage system subsidies in 2011 It was the first sign of energy-storage systems entering the residential market, rather than for emergency industrial power Later in 2014, Japan introduced another plan to raise energy-storage system subsidies by 60% On the other hand, Germany’s electricity retail price is now higher than FiT, which has declined annually, leading to rising demand for autonomous energy-storage systems The subsidy for energy-storage systems represented 30% of overall subsidies in 2013 Take a battery equipped with solar power capacity of 30kW for example, the battery subsidy would approximately amount to EUR 600/kW (equivalent to US$800/kW)
China established new energy power plants that have integrated wind, photovoltaic, energy storage systems to magnify the country’s lithium-ion battery advantages “By promoting electric vehicles and energy storage systems, Chinese lithium battery industry might become another mainstream industry, following in the footsteps of IT,” added Lu
EnergyTrend PVforum 2014 is sponsored by CHROMA ATE INC
Replacement of PDP and Demand for Small TVs Lift LCD TV Demand and Panel Prices, says TrendForce
The 32W-42W panel prices climb USD 1-2 in May 2014, the 46W and 48W see price increases USD 1-3, and the 50W and 55W prices are on par for the first time with some clients even accepting price increases, according to the latest survey by WitsView, the display research division of TrendForce
As for the monitor panel prices, due to the constrained capacity, the 185W, 20W and 27W show on-par prices, the 19W panel sees USD 1 price increase, the 195W and 215W prices climb slightly USD 03-05 The price increases for 23W, 236W, and 24W are around USD 05-1
In terms of NB panel prices, the 156”Wedge and FLAT have USD 05-1 price increases, and even USD 1-3 price increase for the additional procurement The 140W Wedge and Flat prices climb slightly USD 02-05, the 173W price at least stays on par, and the 116W and 133W prices remain on par
“As the LCD TV panel demand is stronger than expected, and mid-and small-sized products share the G5 capacity, along with the subsidy policy on AIO models (mainly 195W) and the spec and product shifts, the monitor capacity is constantly constrained,” says WitsView Research Director Burrell Liu “Microsoft’s subsidy policy on low-priced NB under USD 249 propels the demand for 156W NBs With the economic recovery in Europe and the US, the demands for mid-range 156W and 140W NBs heat up WitsView projects the NB panel price in Q2 to stay on par or climb slightly as international brands’ demand for smart phones grows and squeezes some of NB panel capacity”
Some good news is also heard in the TV market, and thanks to the PDP TV demand replaced by LCD TVs and Mexico’s official subsidy on small 236W TVs, the LCD TV shipment in this year is likely to top the previous projection, 2091 M units On the other hand, Chinese top six brands’ average inventory is only 47 weeks after Labor Day and they potentially show explosive growth in panel replenishment in the months to come with the healthy inventory level and the ambition to reach the annual shipment target in H2’14
Meanwhile, panel makers are preparing for the market of H2’14 and emphasize on product developments, including new sizes, curved TV panels, 4K2K products, large sizes, chopper process, and OLED The product diversification is beneficial to maintain the full capacity through Q3, while the capacity waste and capacity squeeze accompanying with lower yield caused by the new products are also crucial to adjust the supply end and make the supply of certain panels and sizes relatively tight
Due to the potentially strong peak quarter performances of smartphones, tablets, and enterprise SSDs, the 2014 NAND Flash bit demand is expected to grow 39% compared to the previous year, whereas total industry output value has a chance of rising 5% YoY to US$ 252 billion, according to DRAMeXchange, the memory and storage research division of TrendForce
As shown by the manufacturers' 2014 production plans, a good number of the NAND Flash maker's increased capacity in 2014 were driven by their active technological migrations Given concerns over the NAND Flash manufacturing processes' reaching of its scaling limit this year, more and more companies have begun to invest in technologies that are intended for next year's 3D NAND Flash production, with total investment amount expected to rise 12% YoY in 2014 to an estimated US$ 92 billion
Samsung's Xian Plant, whose operations officially began in May, is currently expected to account for the majority of the company's expanded output as well as focus on developing 3D NAND Flash technology Taking into account the time it takes for 3D NAND products to be verified by clients and the Xian plant's intention of adjusting its production ratios based on 3D NAND Flash demand, TrendForce believes that the overall output contributed by Samsung's Chinese plant will be relatively limited this year, and predicts Samsung's 2014 production growth will only reach 40%
Looking over to Toshiba, given that the second phase of the company's Fab 5 construction is not expected to be complete until the third quarter of this year, the official deployment of its relevant production equipments might not take place until the fourth quarter The plant will mainly be focused on producing 1z nm and 3D NAND Flash products, with volume production set to begin in 1Q 2015 As a sign of its ambition and interest in 3D NAND technology, Toshiba announced a few days ago that it would also be revamping its original Fab 2 plant and have it produce new 3D NAND Flash components as early as 2016 Despite the Fab 2 plant's new operations being scheduled from 2H 2015 to 2016, Toshiba's yearly output growth could still reach a hefty 38% this year thanks to its active migration towards 1ynm technology
With regard to SK Hynix, the Korean company’s Q2 NAND Flash output is currently expected to return to the levels before 3Q 2013’s fire accident as it continues to show promising recovery and re-allocate portions of its production capacity to NAND Flash With SK Hynix's 16nm products currently being verified by clients at a respectable rate, the company should have little trouble satisfying its OEM client demands during the upcoming peak quarters
The new Micron group, like SK Hynix, appears to have a similarly optimistic business outlook as its Singapore plant completes its DRAM-to-NAND Flash transition this quarter and raises its total NAND Flash capacity to approximately 230K/M The plant will primarily serve as a production base for critical products such as eMMC, eMCP, and SSDs Taking into consideration the wafer production progresses of the key NAND Flash companies mentioned above, the 2014 bit output growth for the entire industry is estimated at 38% YoY
While Samsung has been able to use its existing chip technologies to accelerate the integration of its 3D NAND Flash components into embedded products such as enterprise SSDs, the company's progress with 3D NAND Flash is still relatively limited this year due to the longer than expected client verification and testing processes Toshiba is looking to produce 3D NAND Flash on a limited scale beginning in 3Q 2014, but will be unable to contribute significantly to the 3D NAND Flash market as its new equipments will not be ready for mass production until 2H 2015 or 2016 Like Toshiba, neither SK Hynix nor Micron is expected to mass produce their 3D NAND Flash products until the second half of next year Given the existing 3D NAND Flash production schedules, TrendForce has revised the 2014 3D NAND Flash output ratio to 2% The proportion of 3D NAND Flash products is expected to gradually increase only when manufacturers officially mass produce the product in 2H 2015
TrendForce: San’an Opto and Epistar Combined Take More than 50% of China’s LED Chip Market Share
LED chip market scale reached RMB 9 billion (US$145 billion) in China in 2013, a YoY of 16%, according to the latest “2014 Chinese LED Package Industry Market Report” by LEDinside, a research division of TrendForce
Spurred by lighting market growth momentum, LED chip market demand further increased resulting in expanded market size However, continual price drops caused LED chip market revenue growth to lag behind market volume demands Certain LED chip manufacturers in the market will fail to increase revenue and profit even after expanding production capacity
Fig 1: LED Chip Market Size in China from 2012-2013
Source：LEDinside
Chinese LED chip market’s industrial concentration continues upward climb with San’an Opto and Epistar making up more than half the market
San’an Opto and Epistar’s combined LED chip market share in China is about 51%, according to data compiled by LEDinside San’an Opto’s revenue share constitutes more than 40% of Chinese manufacturers’total revenue, while Epistar’s LED chip revenue is a staggering 80% of imported Taiwanese LED chips in China
Manufacturers continue to encounter difficulties in raising profitability, with many small to mid-sized manufacturers caving under financing pressure Some small to mid-sized manufacturers have exited the market, due to difficulties in maintaining client relationships, and lack of technological breakthroughs San’an Opto, a representative of large manufacturers, is currently actively expanding production capacity Accompanying industry developments, Chinese LED chip market’s industrial concentration will continue to rise
LED chips are a principal component in LED packaging, and are playing an increasingly important role Other technical innovations in auxiliary materials including lead frame (EMC/PCT lead frame), phosphor powder (remote phosphor) and adhesives have also significantly impacted LED package industry’s technological developments In addition, market observations clearly indicate the emergence of Chinese package auxiliary material manufacturers, with rapidly expanding market shares
Fig 3 2013 Chinese chip market share analysis
<span 16em;"="">Source：LEDinside
Tablet Shipment Rebounds in April with Projected 15%-20% Growth in May, says TrendForce
The large-sized panel shipment decreased by 2% MoM to 6529M units in April With growing tablet panel demand, the large-sized panel shipment is expected to increase by 5% in May, according to the latest survey by WitsView, the display research division of TrendForce
The TV panel shipment is likely to stay on par with April or decline slightly by 1% The monitor and NB panel shipment will both grow by 1-2%, and the tablet panel shipment is expected to reach 15%-20% growth as the white-box and brand tablets, including ASUS, Lenovo, acer, and Xiaomi, increase channel distribution for new models
“In Q3, tablet and smart phone panels are projected to reach a shipment peak, and the IT panel price is likely to continue to increase,” says WitsView Senior Research Manager, Jeffy Chen “However, after mid-Q3, IT brands’ inventory adjustment scale will determine the ensuing trend for IT panel prices”
“Panel makers’ IT panel capacity is constrained in Q2 by the rising demand for LCD TV panel, tablets, and smart phones,” Chen adds “If panel makers take into account profits and market growth and gradually lift the proportion of tablet and smart phone panels in the G5 production line, the NB panel will be the first to experience supply shortage, which in turn will not sufficiently meet NB brands’ demand for sets In particular, Microsoft’s launch of low-priced NB subsidy, also propelled the 1H 2014 NB panel demand to be stronger YoY ”
Main panel makers have different production strategies on wide-viewing-angle feature (IPS/VA) and diverse sizes, resulting in the difficulty for brands’ new product kickoffs to have unified specs It also caused a supply gap for the TN product With various factors in place, the tight supply for both 19”W/215”W monitor panels and 14”/156”NB panels will boost the recent price increase for IT panels As the panel products are undergoing a reshuffle at the supply end, this year, IT brands cannot effectively acquire panel supply, which in turn will increase the risk of affecting the annual shipment goal achievement
The total LCD TV panel shipment in April reached 2051 million units, growing nearly 6% YoY Due to new models promotions, Labor Day holidays in China, and FIFA World Games, brand clients showed stronger demand for panels than the previous year, topped with diversifying product mix at the panel supply end, which resulted in tight supply for some sizes
The monitor panel shipment reached 1328 million units, declining 51% MoM The NB panel shipment hit 1537 million units, declining 32% MoM The tablet panel shipment rebounded slightly to 1611 million units in April, rising 28% MoM but still falling by 10% YoY
Figure 1: Large-sized LCD Panel Shipment in April (K units)
