LCD glass continues to be scarce

In its Quarterly LCD Glass Subsctrate Report, DisplaySearch says that TFT LCD glass tightness this year will continue as TFT LCD panel makers are increasing capacity use and demanding more glass substrate from suppliers.

The second quarter's glass demand increased by 26% and was much higher than the glass supply growth of 12%.

This has created a tight supply situation and led TFT LCD makers to call for increased allocations from their glass sources for the rest of this year.

Assuming glass companies continue to bring more capacity online, supply is expected to grow at 8%.

DisplaySearch estimates that glass supply demand will reach a balance late this year.

The glass supply-demand balance in Taiwan has been different from Korea or Japan, according to Tadashi Uno, director of materials and components market research at DisplaySearch and the author of the report.

The economic crisis that hit in October 2008 impacted Taiwanese TFT LCD makers the most, due to currency differences and customer relationships. In Q4'08 and Q1'09, TFT LCD makers consumed glass inventory and reduced glass orders, especially Taiwanese panel makers.

Uno continued, "Starting in Q2'09, TFT LCD makers began rapidly ramping up production, and are placing full-capacity orders to glass makers. However, it takes one to two months to bring a stopped tank back to mass production, leading to glass substrate tightness."

The consolidated global market share of Corning and SCP (Samsung Corning Precision) was 52% in Q1'09, down from 55% in Q4'08.

The three main Japanese glass substrate suppliers all gained share: AGC (Asahi Glass Corp) had 23% share, up from 22% in Q4'08, NEG had 19%, up from 18% in Q1'09, and AvanStrate's share also increased, from 5% in Q4'08 and 6% in Q1'09.