Global display makers to cut production due to weak demand — Cyprus Mail

Cypriot outlet Cyprus Mail reports that global display panel manufacturers may cut production in October due to weaker demand for TV and IT panels, as well as inventory pressure. According to a forecast by research firm Omdia, the average utilization rate at display manufacturing plants will fall by three percentage points from September to 80%.

Demand for TV and IT panels is weakening

The main factors behind the expected decline are weakening demand for TV panels at the end of the year and sluggish demand for panels for IT devices.

Omdia also noted that rising memory prices are increasing the cost of electronic devices, putting additional pressure on demand for IT panels. In July, production volumes of such panels significantly exceeded shipments amid declining deliveries of displays for mobile computers. This increased pressure on manufacturers’ inventories.

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Chinese manufacturers will reduce plant utilization

Panel manufacturers are expected to plan output more cautiously to prevent further price declines. The three largest Chinese manufacturers — BOE, China Star and HKC Display — may reduce the average utilization rate of their facilities by four percentage points month-on-month.

According to Omdia, the combination of weaker demand and increased inventories is prompting companies to adjust production primarily to support panel prices rather than maintain output volumes typical of the beginning of the year.