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Market Trend

Large Size TV Becomes Mainstream with Lasting Panel Price Hike in 1Q17
Published Dec.21 2016, 10:32AM (GMT+8)

According to WitsView's latest statistics, Market Confidence Index (MCI) rose 389.2 points, from 4500.8 points to 4890.6 points during the period from November 6 to December 9, 2016.United States Department of Commerce announced, in third quarter of 2016, consumer spending rose from the initial value of up 2.1% to up 2.8%.Besides, job market turned better and salaries increased. Both factors elevated family confidence, so the US consumer spending growth accelerated. In November 2016, University of Michigan Consumer Sentiment Index increased 2.2 from previous value 91.6, and came to 93.8.Due to the stable job market and rising consumer spending, in the third quarter, the US GDP's growth rate was modified upwards from earlier prediction 2.9% saar to 3.2% saar, better than the market expectation. Thus, Fed's probability to raise interest rate on December 14 might increase. If the US dollar does appreciate, the dollar will become more dominating. After Trump's inauguration in January 2017, whether the US will really exit Trans-Pacific Partnership (TPP) or not will determine the Asian economy's direction in 2017.Italy's Constitutional-reform referendum was done on Dec. 4. The camp against the reform defeated the pro-reform camp by 60% of voters. After the downfall, Italian Prime Minister Mateo Renzi pledged to step down in order to assume all the responsibility of the failure to change the Italy's Constitution. If Mr. Renzi successfully resigns, current government will risk collapsing. The populist party might ride with the momentum to replace Democratic Party, and become the new ruling party. If Italy, as the Euro zone's fourth largest economy, is ruled over by populist party who proposes exiting EU and abandoning Europe's common currency, then the party might unleash a huge shock to the EU. For the coming 2017, there are a lot of concerns for EU, such as France's presidential election in May 2017 and Germany's Federal elections in the fall of 2017. These factors will crucially determine where EU economy will go.


China's importing and exporting data were both better than expected in November, which both were charged by the US dollars. China' exporting performance was better than previous prediction (down 5% YoY) and came to up 0.1% YoY. This was the first positive figure in the past eight months.In terms of importing, performance was modified from last prediction (down 1.9% YoY) to up 6.7% YoY, an outstanding result.Exporting result's growth was chiefly due to RMB's depreciation. Importing result's upswing growth was due to global PPI's re-bounding. OPEC hadn't agreed on petroleum production cut, so investors procured Japanese yen to avoid risks. This move made Japanese yen to appreciate. On November 30, OPEC finally reached agreement of cutting production. Therefore, Japanese yen is predicted to begin to depreciate. If the USA Feb decided to raise interest on December 14's FOMC meeting, then US dollar will rise against the Japanese yen. This move will increase corporate Japan's profitability.


At the end of Q4, some panel makers benefited by 2H16's panel price hike, so they generated good revenues. According to WitsView's latest panel price report, 39.5" and 43" LCD TV panel was influenced by SDC's Fab 7-1 closure, so their supply became more intensified. During the first 10 days of December, these two segments both hiked price for US $2, respectively. Their individual price reached US $137 and US $146, respectively.As to 49" & 50" FHD panels, due to mid-size panel supply shortage, these two segments received transferred orders. During first 10 days of December, each of them hiked price for US $3, respectively. Their price arrived at US $158 and US $162, respectively.Generally speaking, the 40"~50" LCD TV panels supply intensified. Double booking scenarios have been on the rise. However, this segment's future price trend will crucially depend on USA Christmas season's and Black Friday's sales. Moreover, 55" and 65" segment helped brands' revenues more. Large size products not only steadily became the mainstream sizes in the Chinese market, but also became popular products in this year's holiday seasons. WitsView predicts that large size's increasing market shares will be an irreversible trend. During the first 10 days of December, 55" and 65" LCD TV panel price increased about US $2~3.In 1Q17, large size TV panel will encounter an off season with a weaker demand. However, its price is predicted to be maintained at a certain level.As to LCD monitor panel, its reached the balance of supply-and-demand, and its end-market demand has decreased. Thus, its price was relatively flat than LCD TV panels. During the first 10 days of December, 23.8" LCD monitor panel price remained constant to the price in November, and came to US $64.5.Regarding to NB panels, 15.6" HD TN panel's demand from the USA brands still existed. In addition, brands were concerned that Korean panel makers might significantly exit this segment's production. Hence, supply became relatively tense. During the first 10 days of December, this segment still increased price for US $0.2~0.3. The price rise trend is projected to last to January 2017.

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