What They Say
Well, if feels like DSCC Daily, today, but the firm has put out a lot of good, free data this week! The firm reports that Nippon Electric Glass (NEG) has had a power outage that will affect its capacity, adding to tightness in the glass market. An unrelated tank problem at one of Corning’s Gen 10.5 plants in China adds to the supply woes. A constraint on glass supply may lead to a corresponding constraint on LCD panel supply which may lead to even greater price increases for LCD panels, DSCC said.
DSCC estimates that NEG capacity at Takatsuki in Q4 2020 is approximately 9.9 million square meters for the quarter, or 3.3 million square meters per month. This represents more than 25% of NEG’s worldwide capacity and nearly 6% of total industry capacity for display glass, so a loss of even half this amount represents a substantial disruption in glass supply to the flat panel display industry.
DSCC speculated that the tightness might even lead to the first price rise in display glass history, and, at least a period of flatness.
What We Think
Back in the 70s and early 80s, I worked in the steel industry and an unplanned blast furnace shutdown meant months of work to get back on line. The same applies in glass tanks. It’s even worse, when it’s a whole site problem, not just a single tank, as there are only limited resources with the required skills to repair and re-start the equipment. DSCC put out this extract of its display glass database, showing the top six LCD plants by volume supplied by NEG, with our estimated volume for Q4 2020 in thousands of square metres. These six plants represent about 61% of NEG’s glass demand for Q4 2020. Four of the six are LGD plants; this stands to reason because LGD represents almost 50% of NEG’s shipments, and NEG supplies more than ¾ of LGD’s display glass. The two companies have a joint venture for finishing display glass in Korea and clearly have a strategic partnership. (BR)
