18 January 2011
LED pricing pressure extending into Q1/2011
In fourth-quarter 2010, demand from LED applications had still not recovered, including continued inventory adjustment of large-size panels and lower-than-expected demand from general lighting, according to the latest price survey by LEDinside (an LED research division of TrendForce).
As a result, the pressure of LED price decline has extended from Q3/2010. In particular, the price of LEDs for large-size panel applications fell by 5–9%, with the most substantial decline being in TV backlight applications. The declined for high-power LED lighting applications was more than 12%. In contrast, due to the relatively stable demand from mobile phone applications, LED prices in this segment are fairly stable, with a mere 3% seasonally adjusted decrease.
Regarding prices of LEDs in large-size backlight applications, in Q4/2010 — due to the slower-than-expected recovery in panel shipments — vendors adjusted shipments, while LED demand recovery is not yet in sight. Hence, in TV backlight applications the price of LEDs for the mainstream specification (5630) fell by 9% (to $0.11–0.15), while the price of LEDs for LCD notebook backlighting fell by 5–6%.
LEDinside notes that LED prices for mobile backlighting applications (including specifications 0.4t and 0.6t) are currently relatively stable due to the stable level of shipments; price decline for this segment was estimated to be 3% in Q4/2010.
In high-power LED lighting applications, LED prices declined substantially, affected by weak demand coupled with inventory pressure; in particular, prices for the mainstream specification (100–120lm) plummeted by 12% in Q4, says LEDinside.
Due to greater inventory pressure from large-size backlight applications, LEDinside expects demand in this segment to recover gradually at the end of Q1/2011, after which price pressure is expected to ease. Regarding the price of LEDs for LCD TV applications, LEDinside expects a 9% decline in Q1. High-power LEDs may face pressure from inventory clearing, so prices in this sector are expected to post a double-digit decline, concludes LEDinside.