GLII: LED chip price fell 40% in 2011

[Source: "New Industry" June issue] In 2011, LED upstream chip manufacturers were a tough year, and fierce market competition led to the continuous reduction of corporate gross margin.

But in fact, the domestic LED upstream industry development rate is not slow, the number of upstream chip manufacturers has increased sharply, but the industry market expectations are too high, resulting in fierce market competition, LED chip prices continue to decline, the average annual decline of nearly 40%. The chip production value is 6 billion yuan.

According to data from the High-Tech LED Industry Research Institute (GLII), the output value of LED chips in mainland China in 2011 was 6 billion yuan, a year-on-year increase of 50%. Compared with 2010, the growth rate dropped sharply.

However, from 2007 to 2009, the annual growth rate of LED epitaxial chips in mainland China is only over 20%. In 2007, the output value of LED chips in mainland China was 1.3 billion yuan. In 2008, the output value of LED chips rose to 1.6 billion yuan, a year-on-year increase of 23%. In 2009, the output value of LED chips in mainland China was 2 billion yuan, a year-on-year increase of 25%.

With the acceleration of the transfer of production capacity from LED upstream manufacturers in Taiwan to the mainland, and the active expansion of mainland manufacturers, the output value of mainland LED chips has grown rapidly.

Mainland manufacturers have introduced a large number of new MOCVD equipment since 2010. In 2010, the output value of LED chips in China increased to 4 billion yuan, an increase of 100% compared with 2009.

In 2011, the MOCVD part introduced by mainland manufacturers in 2010 began mass production, but the growth rate of LED downstream application market was not as expected. The market competition was fierce, resulting in a large drop in the price of LED chips. Finally, the output value of LED chips in mainland China rose to 6 billion yuan. , a year-on-year increase of 50%.

Among them, LED LCD backlight market is the fastest growing area of ​​LED market in the past two years. In mid-May, GLII learned from major domestic TV manufacturers that the current penetration rate of LED TVs in the newly produced LCD TVs has reached 100%, and the traditional CC FL TVs have basically stopped production. This also means that the LED backlight market will not grow significantly in the future, and the main driving force for the future growth of the LED market will turn to the general lighting market.

Due to technological breakthroughs, the price of LED chips has begun to decline significantly. In 2011, the average price of LED chips dropped by 40%. In 2012, LED lighting began to enter the Chinese general lighting market and began to be gradually accepted by the market, while the growth of the government engineering and commercial lighting markets was particularly evident.

Price fell 40%

According to data from the High-Tech LED Industry Research Institute (GLII), from the 2009 to the third quarter of 2010, due to the rapid expansion of LED packaging companies, the price of LED chips fell by no more than 7% per quarter.

However, after the fourth quarter of 2010, with the gradual release of LED chip production capacity, the LED chip market changed from the seller's market to the buyer's market. The average price of chips dropped by more than 10%, and individual products fell by 24%.

The trend of sharply falling prices has run through the entire year of 2011. In 2011, the average price of LED-power white light chips in mainland China fell by nearly 40%.

Among them, the average price of high-power low-end chips in the first quarter of 2011 was 1101.2 yuan / K, and the average price in the fourth quarter has dropped to 564.8 yuan / K, a drop of 48.7%. The average price of high-power mid-range chips in the first quarter of last year was 1685.2 yuan / K, and the average price in the fourth quarter was 973.6 yuan / K, a decrease of 42.2%. The price drop of high-power high-end chips was relatively stable, with a drop of only 18.2% for the whole year.
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