Blue LED Prices Down 32% Y/Y in Q218
August 13, 2018
According to data from Taiwan based Trendforce, the price of blue LEDs, the mainstay of LED lighting and display backlights, has fallen from ~$22 in Q117 to ~$15 Q118 down 32% Y/Y and has reached what is production cost for many LED producers. The $22 peak last year was a function of a smaller rise in blue LED prices early last year that led to overbooking by LED packagers, afraid of not meeting quotas and deadlines. As these bookings were converted into inventory, prices sagged and continued to decline, exacerbated by fears of a continuing trade battle between the US and China. While many producers have shifted production to red LEDs and other specialty products (automotive), lacks of demand for LED lighting and relatively low expectations for TV sales have done little to stem the negative tide. Should this continue through the end of the year, there could be write-offs from some of the smaller Taiwanese packagers and some consolidation among the smaller Chinese players, while those with broad based portfolios will likely weather the pricing downturn.