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Size segments that are seeing significant price decline include the 65- and the 55-inch as well as the mid-size panels ranging from the 40- to the 43-inch. The panel market at the end of July generally anticipated falling quotes, though there was no consensus on the size of the decline.
On the other hand, the panel industry’s overall production capacity is expanding rapidly this third quarter, and the fourth-quarter panel demand outlook is still very uncertain. Most panel buyers therefore are entering the upcoming procurement negotiations with the expectation of a dramatic downward price correction.
Earlier in the second quarter, panel makers were able to keep prices high despite noises in negotiations because buyers are varied in terms of their bargaining power. Furthermore, panel makers offered market development subsidies to some of their clients as an alternative to lowering prices.
This practice allows suppliers to maintain an appearance of high prices while helping to reduce the cost pressure on their clients. The subsidies also induce clients to place larger orders and extend their partnerships with the suppliers.
However, attempts to ease price decline with this type of inducements have become less effective going into the third quarter as the market now favors buyers on the whole. Hence, panel quotes are likely to fall by wider margins in the near future.
Also, some panel makers in their attempts to secure future demand are offering special deals to TV brands for the Black Friday sales. These deals are boosting panel buyers’ confidence and strengthening their positions in procurement negotiations.
Though some buyers might have an exaggerated view of the Black Friday deals, this kind of news is now reinforcing TV brands’ expectation of steeper price drops.
WitsView’s forecasts of TV panel prices for August show noticeable drops for various size segments compared with July: the 65-inch by 5%~7%, the 55-inch by 4%~6%, the 49- to 50-inch range by 4%~5%, the 40- to 43-inch range by 4%~6% and the 32-inch by 2%~3%.
As for the LCD monitor panels, demand has rebounded by a small margin going into August due to seasonal stock-up activities, but their quotes are not firm due to the influence from TV panel market.
WitsView’s monitor panel price forecast for August indicates that the mainstream size segments will see a drop of US$1~1.5 on average compared with the prior month.
In the LCD notebook panel market, demand in August is going to be supported by the stock-up demand ahead of the back-to-school season and will be relatively stable versus the prior month.
Prices of TN notebook panels are projected to dip slightly by US$0.1~0.2 on average in August compared with July, while prices of IPS notebook panels are projected to fall by US$0.2~0.3.
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