Trade Friction Affects LED Demand And China's Production Status Remains Unchanged.

- Oct 04, 2018-

According to the latest "LED Industry Demand and Supply Database Report" by the LED Inside Research Center, the global LED market output in 2018 was $18.796 billion, up only 4% from 2017, and the growth rate was lower than the 11% forecast at the beginning of this year. The main reason is still the unbalanced supply and demand of the industry. Oversupply leads to LED. Price declines and trade frictions affect terminal demand.——LED lighting

LED inside pointed out that although there are still many Chinese LED manufacturers hope to boost revenue growth by expanding production capacity in 2018, many manufacturers'revenue growth is not as good as expected because the overall industry is under tremendous pressure from price declines. Especially in the first half of this year, some specifications of LED chip prices dropped as much as 20-30%. The main reason is that the terminal demand can not keep up with the growth rate of supply after China's LED chip manufacturers greatly expanded production, resulting in the imbalance of industrial supply and demand. However, because the current chip prices are already close to the cost of most manufacturers, the chances of further sharp price reductions in the short term are not high.——LED lighting

On the demand side, LED manufacturers'exports to North America and other emerging markets have been significantly affected by Sino-US trade frictions and exchange rate depreciation in emerging markets. Among them, the United States recently announced 200 billion U.S. tariff list, LED lighting related products more than 30, accounting for about 70% of China's overall lighting exports to the United States, about 8 billion U.S. dollars. These products will be subject to 10% tariffs from September 24th, and tariffs will rise to 25% in January 1, 2019.——LED lighting

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