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Demand for small-pitch display screens is strong, driving LED chips and packaging prices

At the end of August, LED chips and packaging in mainland China once again showed price increases. LEDInside (China LED Online), a LED industry research brand under TrendForce, said that the strong demand for the small-pitch display market is the main driving force behind the price increase in the supply chain.

According to the LEDinside survey, China's largest chip maker Sanan Optoelectronics and the main display packaging supplier Cinda Optoelectronics announced the price increase of 10% and 5%. LEDinside pointed out that the average number of LEDs used per square meter of indoor LED display will gradually increase from 60,000 in 2015 to 270,000 in the next two years, meaning that upstream LED packages and chips will be available under the same demand area. The number of uses has increased by more than three times.

Since the introduction of the related concept by Liard in 2012, the small-pitch LED display has entered the market growth period, and the market scale is rapidly expanding. The downstream demand and technological advancement space will drive the rapid growth of small-pitch packages and chip consumption.

LEDinside estimates that the number of small-pitch LEDs will reach 29 billion granules in 2016. As China's packaging materials gradually move toward localization, the cost will further decline and promote market development. In 2021, small-pitch LED consumption will reach 189.8 billion granules. The compound annual growth rate is as high as 46%, and the output value is expected to grow from 300 million US dollars in 2016 to 800 million US dollars in 2021, with a compound annual growth rate of 21%.

In addition, the outdoor display has also begun to appear in the trend of small-pitch packaging. With the surface-mount LEDs suitable for outdoor use, the technical problems of high-definition and high-densification of outdoor displays are gradually emerging, and the average spacing is from P10 progresses below P6 and is expected to grow explosively.

LEDinside estimates that the consumption of outdoor LEDs will grow from 93.6 billion in 2015 to 286.4 billion in 2021, with a compound annual growth rate of 20%.

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