What They Say
Quoting a forecast from Sigmaintell, Digitimes said that LCD panels for TVs may hit a low point at the end of Q1 2022. The report said that 232 million TVs were shipped globally in 2021, down 7.1% and it expects a further drop by 3.1% to 225 million units. For panels, the numbers were 260 million, down 2.3% with a drop by 3.1% to 252 million panels forecast for 2022.
Overall, Sigmaintell forecast a growth in capacity for TV panels by 8.1% in 2022, against a demand increase of 4.4% (although units drop, area will grow because of an average size increase). That excess capacity will keep pressure on prices. Panel makers have tried to shift capacity to IT, but those markets are weakening as we come out of the pandemic, so there will be oversupply there as well.
What We Think
We get data from Sigmaintell, but sometimes it’s English language reports are delayed compared to the Chinese language originals. The report doesn’t highlight why prices will stabilise at the end of Q1, but history tells us that this happens when LCD prices get close to cash cost. (BR)
