Peak production of LCD monitors

January LCD monitor production for top PC and monitor brands­ - about 85% of the market­ - was 12.5m, the highest level in more than a year, as noted in the newly announced DisplaySearch Monthly Desktop Monitor Brand and OEM Production Report.

Near-term production build-plans show that March could be the highest monthly production of LCD monitors on record, reaching over 12.9m.

While monthly production rates like these have not been seen since April 2008, it is too early to attribute the higher production levels to an increase in end-market demand.

Other factors include: continued strong demand for 19-24″ LCD TV panels, which affect the supply of similarly sized PC displays and can cause pricing for these panels to rise amid shortages; the threat of increased panel pricing has historically caused monitor companies to pull-in or double-book orders to receive allocation before price hikes; in China, end-market demand for LCD monitors is not very strong in Q1’10, but production requests from the major players in the China market are still strong; the growing dominance of notebook PCs, which outpaced desktop PC shipments for the first time in 2009, calls into question where the increased demand for external, larger-size displays is coming from. Surveys show that consumers (those driving the PC trends towards mobile computing) are far less likely to use a monitor with their notebook than a professional user in a work environment.

The use of LCD technology in desktop monitor displays and in all-in-one desktop PCs means this is still one of the top markets for large-area LCDs. Historically, the supply chain for these products could be managed quarterly.

However, the fast-paced nature of the market and its interdependence on other markets such as notebook PCs and TVs, which compete for the same panel production, now requires that brands and their OEM production partners track production monthly.