Samsung Display Co’s plans to continue manufacturing LCD panels in South Korea are not expected to affect market dynamics in the first half of this year, but might exacerbate a supply glut during the second half, market researcher TrendForce Corp (集邦科技) said in a note on Thursday.
The display unit of Samsung Electronics Co last week said that it would extend its production of panels for TVs and monitors due to COVID-19-driven demand, reversing its announcement in March last year that it would end all production by the end of the year to pursue a technology upgrade.
“Despite previous expectations [that it would] shutter its LCD panel manufacturing operations, Samsung Display will continue manufacturing panels in South Korea, with one 7-generation and two 8.5-generation production lines operating throughout the first quarter of 2021,” TrendForce said.
Photo: Bloomberg
“However, in consideration of costs, technological transition schedules and client demand for specific panel sizes, Samsung Display is expected to retain manufacturing operations at only one 8.5-generation production line in the fourth quarter of 2021,” the Taipei-based research firm said, adding that Samsung Display’s continued panel manufacturing is expected to conclude by the end of this year.
Given persisting component shortages, coupled with steady demand for display panels used in TVs, monitors and laptops, overall LCD panel supply and demand is predicted to mostly remain balanced until the end of the first half, despite Samsung Display’s plan to extend LCD manufacturing, TrendForce said.
However, the research firm did not rule out the possibility of a supply glut in the second half, even though Samsung Display has pledged to sell all of its panels to Samsung Electronics, which has historically been the largest purchaser of display panels, it said.
“The increased panel supply from Samsung Display certainly represents a potential risk that may disrupt the panel industry’s supply and demand equilibrium,” TrendForce said. “Whether Samsung Electronics will shift its panel purchasing strategies in response [to the supply of panels from Samsung Display] will remain an important point of observation for the panel market in 2021.”
In related news, NH Investment & Securities Co expects LCD panel prices, which were high at the end of last year, to continue rising in the first quarter due to an anticipated decrease in glass substrate supply.
That is because Japan-based glass substrate maker Nippon Electric Glass Co (NEG) had a power outage for five hours in its Takatsuki plant in Japan on Dec. 10, the Seoul-based securities firm said in a note on Wednesday.
As the incident damaged five glass furnaces at the Takatsuki plant and might affect NEG’s shipments for about a quarter, NH Investment said that South Korean panel makers and their Taiwanese peers could find it hard to source glass substrate in the short term, which would maintain panel prices into the first quarter.
LCD panel prices would likely remain flat in the second quarter compared with the first quarter due to an acceleration in panel production alongside normalized supply of glass substrates, the securities firm said.
However, panel prices are forecast to decline from the third quarter, as supply should exceed demand due to ongoing production expansion by Chinese manufacturers, centering on facilities that are eighth generation and above, NH Investment said.
TRADE WAR: Tariffs should also apply to any goods that pass through the new Beijing-funded port in Chancay, Peru, an adviser to US president-elect Donald Trump said A veteran adviser to US president-elect Donald Trump is proposing that the 60 percent tariffs that Trump vowed to impose on Chinese goods also apply to goods from any country that pass through a new port that Beijing has built in Peru. The duties should apply to goods from China or countries in South America that pass through the new deep-water port Chancay, a town 60km north of Lima, said Mauricio Claver-Carone, an adviser to the Trump transition team who served as senior director for the western hemisphere on the White House National Security Council in his first administration. “Any product going
TECH SECURITY: The deal assures that ‘some of the most sought-after technology on the planet’ returns to the US, US Secretary of Commerce Gina Raimondo said The administration of US President Joe Biden finalized its CHIPS Act incentive awards for Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), marking a major milestone for a program meant to bring semiconductor production back to US soil. TSMC would get US$6.6 billion in grants as part of the contract, the US Department of Commerce said in a statement yesterday. Though the amount was disclosed earlier this year as part of a preliminary agreement, the deal is now legally binding — making it the first major CHIPS Act award to reach this stage. The chipmaker, which is also taking up to US$5 billion
High above the sparkling surface of the Athens coastline, the cranes for building the 50-floor luxury tower centerpiece of Greece’s future “smart city” look out over the Saronic Gulf. At their feet, construction machinery stirs up dust. Its backers say the 8 billion euro (US$8.43 billion) project financed by private funds is a symbol of Greece’s renaissance after the years of financial stagnation that saw investors flee the country. However, critics see it more as a future “ghetto for the rich.” It is hard to imagine that 10km from the Acropolis, a new city “three times the size of Monaco”
STRUGGLING BUSINESS: South Korea’s biggest company and semiconductor manufacturer’s buyback fuels concerns that it could be missing out on the AI boom Samsung Electronics Co plans to buy back about 10 trillion won (US$7.2 billion) of its own stock over the next year, putting in motion one of the larger shareholder return programs in its history. South Korea’s biggest company would repurchase the stock in stages over the coming 12 months, it said in a regulatory filing on Friday. As a first step, it would buy back about 3 trillion won of paper starting today up until February next year, all of which it would cancel. The board would deliberate on how best to effect the remaining 7 trillion won of buybacks. The move
RSS