Display glass substrate supply is tight through 2021

LONDON (November 16, 2020) — LCD TV and smartphone display demand has increased over the last quarter according to Omdia’s Display Glass Market Tracker.  This increase in panel demand is constricting TFT LCD display component supply, especially glass substrates. 



An LCD panel uses two sheets of glass –one each for the TFT and Colour Filter sides. Increased panel demand thus has a double impact on Display glass area demand. According to Omdia’s latest survey, strong demand for Display application devices in 2H20 will carry over into 2021. Additionally, continuously increasing average LCD TV sizes are driving area growth and resulting in a supply challenge for TFT display glass substrates.



Average LCD Growth Size:



LCD display production has expanded the glass substrate size from Gen1 to Gen 10.5. Gen 10.5 is almost 10 square meters and panel makers can fabricate eight 65-inch panels on one sheet. The quality requirements for Display glass continue to increase every year even as glass substrates become larger. It is difficult for new glass makers to meet these stringent quality specifications. This is one reason that glass substrate supply tightens when display application growth increases more rapidly than glass makers’ capacity expansions. 

Omdia’s Display Glass Market Tracker analyses glass supply/demand on a quarterly basis. When the glut level falls below 5% glass supply is tight; as it rises higher, supply issues ebb.  Based on this, display glass supply/demand has been very tight from 2Q20 and is modeled to fall again to only a 3% glut in 2Q and 3Q21. 



Tadashi Uno, Research manager of Display components and costs at Omdia, commented: “Display materials demand is quite strong through 2021. 3Q20 Display glass supply/demand ratio is 0% and 4Q20 is 4%. This is quite a tight situation. Panel makers are having a difficult time procuring enough glass substrates. Also, COVID-19 is still negatively impacting the material supply chain, and this is increasing confusion in the glass supply chain now. All of which affect glass substrate prices.”



“For the past decade, we have been seeing the glass substrate price fall consistently due to the cost reduction requirement from the display makers and economies of scale. However, this may be different in 2021. As glass substrates are expected to remain tight next year. Also, prices of several other display components, such as Driver ICs and polarizers, are increasing due to high demand and tight supply. For these reasons we anticipate that the display glass substrate price will remain relatively stable during 2021.”



Supplier Oligopoly 



Display glass substrate suppliers have held an Oligopoly for decades. Three major Display Glass manufacturers have dominated the industry –US headquartered Corning, and Japan based AGC and NEG. Although new players have tried to enter the market, they have found significant barriers to entry. For example, when LG Chemical entered the market, it was a small volume operation that did not drive profit. LG Chemical finally closed down the operation in 2020. 



There has also been significant investment from the Chinese government to enter the Display Glass industry. Since 2010 three local glass producers have tried to build up FPD businesses but have failed to gain significant market share.

-ENDS-

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