LCD Panel Prices Continue to Rise

Samsung Display and LG Display have put their LCD exit strategies on hold as LCD panel prices continue to rise.

As LCD panel prices continue to soar, Samsung Display and LG Display have put their LCD exit strategies on hold.

The price of 55-inch LCD panels stood at US$181 in January and is expected to rise to US$188 in March, said market research company Omdia on Feb. 4. Compared to January 2020, the price nearly doubled in a year.

The prices of 50-inch and 65-inch panels are also on the uptick. In February, they reached US$154 and US$230, respectively, up 81 percent and 42 percent from 2020.

Analysts say that large LCD panels’ upward trend will continue until 2022. Omdia predicted that the price of a 55-inch LCD panel will remain above US$186 on average in the first quarter of this year and stay in the US$170 range at the end of 2021. Omdia estimates the average price in 2022 at US$165, suggesting it will not fall below US$160 in the worst case.

Prices of large LCD panels began to fall sharply in 2019 due to Chinese companies' price war. They stood at US$143 in January 2019 but fell sharply to US$100 in nine months. At the time, Korean LCD makers lost their market leadership to Chinese competitors. In 2019, China companies’ market share rose to 48 percent, surpassing Korean firms’ 26 percent. Samsung Display and LG Display decided to sell LCDs only until the end of 2020 as they sold LCDs below cost.

However, the situation made a dramatic turn as demand surpassed supply since the second half of 2020. This was due to a surge in demand for TVs caused by the spread of COVID-19 amid a drop in supply due to production cuts by Samsung and LG. This development pushed up LCD prices, and profitability shot up as the unit price topped US$150, analysts say. Both Samsung Display and LG Display say they will flexibly respond to market situations without revealing specific production schedules.

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