in mainland China, the continuous improvement of China tft lcd manufacturers are in rapid development, the TV industry chain in China has a significant aggregation and continues to expanding, Even after the trade war between China and the United States in 2018-19, the global tft panel industrial center continues to sheift to mainland China.
According to the global TV panel shipment data, the proportion of TV panel production area in the Chinese mainland reached 40.1% in 2019, an increase of 13.8% from 2018. It is expected that the proportion of tft panel production area in the Chinese mainland will reach 53.7% in 2020. At the beginning of 2020, after the outbreak of the COVID-19 in China, LCD production was suspended for a time, and the global TV industry chain was seriously affected. The impact on the TV panel industry was occurred “Lack of jobs in February, lack of materials in March”, the Q1 shipments will fall sharply
In Q1 2020, the China TFT panel and oled display panel industry was mainly affected by the resumption of work and the supply of materials. After the China Spring Festival, the time of returning to work was continuously delayed in China mainland, but because of the high level of automation in tft panel facility, the front section of the tft panel factory process is also in normal operation during the China Spring Festival, not directly affected by the COVID-19 outbreak.
However, the latter TFT LCD module section belongs to the personnel intensive production, it is similar the monochrome lcd facility, it need more personnel production, but the low rework rate directly affects the output of the finished tft lcd panel. At the same time affected by the panel’s raw materials, to short – term polarizer and packaging material. The cutting of the back section of polarizer and the production of packaging materials are personnel intensive industries. The delay in the resumption of work and the shortage of personnel lead to the shortage of production and supply in tft lcd module factory, which also affects the production and shipment of the tft panel factory.
In the second half of February, with the continuous easing of the national recovering working policy, the panel factory, polarizer and packaging material factory improved greatly, and the recovering working rate of the enterprise exceeded 80%.Overall, the above factors on the panel production constraints have been gradually removed.
In March, the main bottleneck of TV panel production shifted to PCB supply. Huangshi city in China Hubei province is one of the three major PCB industry company in China, and its production capacity accounts for about 20% of the national total. During the COVID-19 outbreak, most industrial production in Hubei province stopped, The panel plant had a certain production capacity in February by the inventory of PCB, but the continuing shutdown in Hubei province had a direct impact on some TFT panel plant production in March. Since end of March, production has gradually resumed in low-risk areas of the outbreak in Hubei, and the supply capacity of PCB is expected to gradually recover. China’s outbreak began to recover, while outbreaks in South Korea and Japan have exploded, it still affect the global panel industry. Even panel production is concentrated in mainland China, the production and supply of some key materials such as semiconductor materials, optical film substrates and liquid crystal materials supporting panels are still dominated by Japan and South Korea. Even supplies are not affected because of the high degree of automation in the production of these materials, but the need to continue to observe the development of the outbreak and the restrictions on logistics and transportation may lead to delays in the delivery of supplies.
Global shipments of TV panels in Q1 of 2020 decreased 12.7% according to forecasts. Some of the impact has come from the close of TV panel production capacity at Korean panel factories and the China domestic new capacity has not to be released. On the other hand, it is also affected from the “lack of materials” on the panel factory supply capacity.
Tight in supply and demand was occurred in Q1 of TV panel prices increased
The sharply drop in supply led to a tightening of the supply of TV panels in February 2020.This is partly because supply has fallen sharply, On the other hand, it is because the whole tft lcd machine manufacturers have not adjusted the panel requirements based on the COVID-19 situation.
TFT panel prices have increased starting at the end of 2019.In the case of a 55-inch TV panel, the increase was $7.The mainstream size price will fall below the cost line in 2019, which will do great harm to the TV panel industry. The recovery of the current price is a positive factor for the development of the tft panel industry. However, the global spread of the outbreak will have a huge impact on the demand for TV set, which will affect the growth of TV panel prices in the Q2, 2020
A sharp drop in global demand for television sets will affect the TFT panel and oled display panel market after the Q1 of 2020, global TV shipments are expected to decrease 7.8%. TV shipments on the Chinese mainland will decreased 27.1%.
In Q2 2020, the Chinese market will improve, and the European and American markets will likely face the situation that China experienced in the first quarter, or even worse if the epidemic goes out of control, so the global color TV manufacturers’ shipment plans will drop sharply in the Q2. Now that the European championship has been postponed until 2021, shipments of some mainstream brands in Europe could be cut 50%. The US market, the second largest in the world, will also face huge challenges from the outbreak. Tft panel and oled panel demand will fall sharply, while panel supply capacity is improving, TV panel supply and demand will be decreased, even in Q2 2020, there is a risk of oversupply. This requires the panel factory to flexibly respond to the demand changes of the whole plant, to control the new capacity, to avoid the TFT panel industry go into the next downward cycle.
