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Company News >> Epidemic impact analysis: Q1 global LCD TV panel shipments decreased by 3.6%, short-term price increases 25th,March,2020
                                     The spring of 2020 will certainly leave a strong stroke in our memory. The sudden outbreak of new crown pneumonia spreads across the country and spreads to many regions around the world. Affected by this, delays in the resumption of business and irregular logistics have caused a significant impact on the panel industry with complex industrial chain links. At the same time, the epidemic situation has significantly affected the terminal retail market. According to Sigmaintell, the impact of the epidemic on the TV industry is mainly reflected in the following aspects:

Impact one: tight supply of upstream materials for panels such as PCBs and polarizers

Materials, labor, and logistics are common issues facing the entire display industry. For panel makers, the upstream material gaps mainly include PCBs, polarizers, and other related electronic materials and consumables.

In late February, as the epidemic situation in provinces outside Hubei has gradually eased, local governments have also actively guided enterprises to resume work as soon as possible to accelerate the return of the industrial chain to normal levels. It is expected that the output situation of panel factories in March will be significantly improved. However, the spread of overseas epidemics is accelerating, and we must be alert to and prevent Japan and South Korea and other regions from being affected by the epidemic to increase the impact of the industrial chain.

Impact # 2: The production capacity of the rear section of the panel plant is damaged, and the shipment in the first quarter is expected to decrease by 3.6%

At present, nearly half of the global LCD TV panel production capacity is concentrated in mainland China. In addition, the production capacity of some overseas panel manufacturers in the rear stage is also distributed in China, which shows the impact.

According to a survey by Sigmaintell, the glass array in the front section of the panel factory has not been significantly affected by the epidemic situation, and the crop activity rate in the first quarter has been slightly reduced. However, due to the postponement of resumption of work, limited logistics and shortage of raw materials, it has a greater impact on the production of the latter part of the panel plant. It is expected that the output of global LCD TV panels (Open cells) in February will be 13.8% lower than originally planned.

From the perspective of panel factory shipments, due to the severe production capacity loss in the latter part of the panel in February, it will have a greater impact on panel shipments in the first quarter. With the recovery rate and the recovery of material supply, the panel output situation is expected to improve significantly in March. According to Sigmaintell data, it is estimated that the global LCD TV panel shipments in the first quarter of 2020 will be 3.6% lower than the pre-epidemic forecast.


Impact # 3: It is expected that the number of TV units shipped in the Chinese market will decline by 18% in the first quarter

Affected by the epidemic, the domestic GDP growth rate is expected to slow down in 2020, and consumer purchasing power will also decline. Sigmaintell predicts that the scale of shipments in the Chinese market will decrease by 18% year-on-year in the first quarter of this year, and it is expected to decrease by 3.1% or even less throughout the year. The epidemic situation is spreading and deteriorating in the global region, and it is expected that it will also have a greater impact on overseas markets.

The epidemic has rapidly cooled the Chinese retail market, and TV demand has dropped sharply. However, it will take time for the changes in the end-consumer market to be transmitted to the adjustment of panel purchase demand. At the same time, due to the many uncertainties in the epidemic, Chinese manufacturers have not reduced the panel stock Demand, the global TV panel stocking demand remained strong in the first quarter.

Impact 4: The supply and demand of LCD TV panels tightened in the first quarter, and the short-term price increase expanded

Affected by the epidemic situation, the delay in resumption of work and insufficient supply of upstream materials led to a short-term supply reduction of the panel factory after the Spring Festival than expected. On the demand side, the overseas market is driven by demand for "races", and the demand for stocking is strong. Although the domestic market saw a dismal first quarter, the demand for panel stocking has not been significantly adjusted in February, which has led to a short-term tightening of the global LCD TV panel supply and demand relationship. According to Sigmaintell's "supply and demand model", in the first quarter of 2020, the supply-demand ratio of the global LCD TV panel market contracted to 4.2%, with tight supply and demand. 32 ”~ 65” and other mainstream sizes are showing tight supply and demand.


At the same time, panel makers are eager for price recovery to improve profitability. Driven by the short-term panel supply and demand tightening, it is expected that the price increase of panels of various sizes will increase in February, and will continue to increase in March.

32 ", strong demand for export stocks, and the shrinking supply scale of mainstream panel makers. The supply-demand ratio in the first quarter was 4.2%, which was tight. The price increase in February expanded to 2 US dollars.

From 39.5 "to 43", stocking for export plus alternative demand has increased, and there is no significant increase in production capacity at the supply side. The supply-demand ratio is 3.8%, supply is tight, and the price rose by $ 3 in February.

On the 50 "front, overseas stocking was positive, demand was better than expected, and panel makers' short-term supply was blocked. The average price increase in February expanded to US $ 3.

55 ", as the mainstream living room size, demand remains strong, and the shrinking supply scale leads to insufficient supply, and the supply-demand ratio came to 3.4%. The price increase in February expanded to $ 5.

In terms of large size, 65 "overseas brands have strong demand for stocking, tight supply and demand, and the average price in February rose by 5 US dollars; 75" overall supply and demand balance, the price maintained.

It is worth noting that with the gradual improvement of the epidemic, the panel supply will return to normal, and the impact of the epidemic on terminal retail will be gradually transmitted to the strategy of panel stocking. Especially after entering the second quarter, the stocking of export competitions has come to an end, and domestic demand in China is sluggish. The possibility of TV manufacturers to adjust the purchase demand for TV panels has increased, driving the global TV panel supply and demand relationship to slow down. According to Sigmaintell's "Supply and Demand Model", the global LCD TV panel market's supply-demand ratio in the second quarter was 5.9%. Supply and demand will tend to be looser in balance, and TV panel prices will also lose their momentum of continued rise.

Of course, there are still many uncertain factors affected by the epidemic situation. We will continue to pay attention to the development of the epidemic situation, especially the impact of the spread of epidemic situation in overseas regions on the industrial chain and global demand, and the end of the first quarter and the second quarter Manufacturer's panel stocking strategy.

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