Source: OFweek Lighting Network

A few days ago, according to South Korea media ET NEWS, in addition to Taiwan's factory crystal power has adjusted the price of LED chips, including mainland China's San 'an Optoelectronics and Huacan Optoelectronics have also increased the price of LED chips. South Korea media and some media believe that this has shown signs of rebound in the price of LED chips, which have been falling in recent years. However, according to the author's actual understanding in the trading market, the remarks made by the senior executives of Sanan Optoelectronics reported by the South Korea media this time are not the content of an exclusive interview, nor are they large-scale price adjustments.

The head of Sanan Optoelectronics said in the South Korea news report that "since May, the prices of some LED chips have risen by 10%" and explained that "market prices are affected by the law of supply and demand". According to the information obtained by the reporter asked Sanan Company, they did not increase the price on a large scale, but some LED chip items of some Chinese chip manufacturers have increased slightly, mainly because some second-line packaging manufacturers prefer to go to the market at a higher price in order to ensure the supply of goods.

However, the operation of San 'an Optoelectronics from 2015 to 2016 was subsidized by the government, which was of positive help to the company. San 'an still made considerable moves in its mass production strategy. In early 2016, another 28 new MOCVD units were put into operation, which was equivalent to the production capacity of 56 old models based on 2-inch wafers and 54 pieces of processing equipment, twelve of them have indeed increased their crop rate and production capacity in March 2016. As costs are expected to be further reduced, the price impact on the future chip market remains to be seen.

Japan Asia Europe and the United States market litigation, patent LED chip manufacturers can better ensure the price.

At present, the categories that see the price increase are mainly high-power LED chips. The technical threshold of these specifications is relatively high, so the supply in the market is relatively small. In addition, due to a series of actions against downstream customers in North America and Europe by Japan's LED major factory, LED chip manufacturers with IP patent protection have a relatively high voice to improve LED chip quotations.

LEDinside pointed out that from the demand side, after entering May and June in 2016, the LED backlight market has seen a significant decline in backlight demand because the introduction of new products by customers is not as fast as expected. It is estimated that another wave of growth momentum will not be seen until July and August. The demand for LED lighting market has also begun to fade since June. However, judging from the annual bargaining between various LED manufacturers and Philips, a major lighting brand manufacturer, since various LED manufacturers have suffered serious losses, even though Philips has a considerable purchase quantity, the overall price decline has slowed down a lot compared with the end of 2015. Overall, the market price of LEDs has stabilized compared to 2015.

LED packaging factory that the market is still oversupply, happy to see LED chip prices

This year, at the 2016 Guangzhou Lighting Exhibition (Guangya Exhibition), LED packaging factory Yiguang also provided views on the price increase of crystal electricity. Liu Bangyan, general manager of Yiguang Production Group, said: "If this is the case, it depends on whether China will follow the rise or maintain the status quo, because we have seen that the price of LED chips in China this year is very small, so it probably cannot fall. If we can increase the price, we are most happy. The problem is that we still maintain the attitude of the audience, depending on the overall demand. Because there is still an oversupply, if the state of supply and demand changes, I think there will be changes at that point in time."

At present, due to the aforementioned factors, some LED chip market prices do show signs of not falling, but on the whole, costs are still reduced due to the expansion of production. The future trend of the industry is still boosted by the increasing demand for LED lighting and special applications. It is difficult to grow back.