Some manufacturers have taken the lead in raising LED chip prices, with hopes that chip prices will stop falling and rebound.
Source: 中国之光网|| Views: 989
Affected by the pandemic in 2020, demand in the traditional lighting application market was weak. As market prices hit rock bottom and the pandemic is expected to be under control in 2021, recent market reports indicate that Chinese LED chip manufacturers have taken the lead in raising prices for lighting LED chips. Due to the chain reaction in the market and strong demand for panels, prices for LED backlight chips are also expected to see a slight increase.
Epistar, an LED chip manufacturer, stated that the fourth quarter is traditionally a slow season for the LED industry. It is expected that overall end-market applications will resume purchasing after the 2021 Lunar New Year, with new product shipments aligned with customers' scheduled timelines. It was pointed out that HC Semitek adjusted the prices of LED lighting chips starting in November, with an increase of around 6–8%, mainly due to the recent rise in material costs and continuous increases in labor wages . 兆驰股份 also recently stated that the company's chip prices have been adjusted upward recently. On one hand, due to the pandemic in the first half of the year, there were some delays in the export of lighting end-products; currently, exports are recovering and the Christmas peak season is approaching, so demand is increasing . On the other hand, some domestic companies have exited the market, and some leading enterprises are also leaving the traditional lighting market, resulting in tight supply conditions . Although standard LED products remain in a situation of oversupply, the fact that prices have bottomed out and demand is expected to recover has driven prices for low-end lighting LED chips to stop falling and start rising. As for LED backlighting, although it has entered the traditional off-season, the panel market remains optimistic through 2021, and production lines will maintain normal supply during the Lunar New Year holiday. Market rumors suggest that following the price increase of lighting chips and the mass production of Mini LED for high-end applications, driven by the overall shift in production capacity, LED backlight products will also follow with price adjustments. However, Epistar declined to comment on the rumors of price hikes. Industry experts point out that standard LED lighting chips have hit rock bottom, with product prices hovering near the cost line. This has prompted LED manufacturers to continuously adjust their lighting product portfolios, including shifting towards emerging application areas such as specialty lighting, horticultural lighting, industrial lighting, or UV LEDs. Meanwhile, business opportunities in Mini LED display technology are booming , accelerating LED manufacturers' efforts to expand their Mini LED production capacity. Benefiting from brand customers, Mini LED products will be launched successively in the first half of 2021. Epistar's operations in 2021 are expected to bottom out. Recent supply chain reports indicate that, with its own production capacity fully loaded, TSMC has purchased new Aixtron equipment for installation at Epistar's Zhunan plant. In the future, GaN fast-charging products will be manufactured by Epistar under a patent licensing model. Apple has recently strengthened its partnership with Epistar. The Mini LED technology jointly developed by both parties at Apple's Longtan facility is reported to have entered the mass production stage. Due to the successful collaboration, Apple has decided to continue working with Epistar towards the development of next-generation Micro LED technology. This also means that Apple will launch products equipped with Mini LED next year. Epistar pointed out that, based on current customer product development status, Mini LED will be first applied in end products such as tablets, laptops, and TVs, with substantial adoption. It is estimated that the Mini LED market demand will fully explode next year . In addition, affected by the rising prices of raw materials such as copper, plastic, aluminum, cardboard, steel, foam, polystyrene, and glass sealant required for LED lighting products, many lighting manufacturers and component suppliers have issued price increase notices , adjusting the prices of certain products. Source: semitrade, Eefocus, etc.
