© saniphoto dreamstime.com Analysis | July 21, 2020
Chinese polarizer manufacturers to occupy over 40% of global production capacity
The display panel industry is expected to see limited growth in large-sized panel input area in 2020 due to the COVID-19 pandemic’s impact and the continued reduction of LCD production capacity in Korea, according to TrendForce’s latest investigations.
Even so, in 2020, polarizer manufacturers will be able to start mass production with two additional 2,500mm production lines, one added in 1H20 and the other one in 2H20. Compared to 2019, therefore, the polarizer industry is expected to be in a state of oversupply, with supply exceeding demand by about 12.3%. China is projected to possess over 40% of the global polarizer production capacity as Ningbo Shanshan acquires LG Chem’s polarizer business TrendForce indicate that, prior to the upcoming sale to Ningbo Shanshan, LG Chem’s polarizer division leads the market by controlling 25% of the global polarizer production capacity. Nitto Denko and Sumitomo Chemical are tied for second place, mainly because Sumitomo was able to raise its capacity share to 21%, on par with Nitto, by acquiring Japan-based Sanritz through purchasing its stocks. On the other hand, China’s display panel industry ranks first globally in terms of both production capacity and shipment. As such, China is likely to place top priority on developing domestic manufacturing operations for key display components. Following Shanshan’s acquisition of LC Chem’s polarizer business, Chinese polarizer manufacturers, including Sapo, Sunnypol, and CMMT, among others, are expected to collectively account for more than 40% of the global polarizer production capacity for the first time, signaling the Chinese polarizer industry’s continued global expansion. China’s key to sustaining its advantage in the industry lies in controlling key thin film R&D activities However, the most important upstream polarizer components, which are retardation films and protective films, including those made from PVA, PMMA, or COP materials, are mainly supplied by Japanese and Korean manufacturers. If Ningbo Shanshan merely takes over LG Chem’s existing production lines and clients, the Chinese company will still face enormous operational pressures in today’s hypercompetitive large-sized LCD polarizer market. For Shanshan to secure its place in the industry, it must accelerate its strategies regarding other polarizer-related segments, first by ensuring its thin-thin R&D momentum, whether through technology transfer or through patent licensing. Only by doing so is the Chinese polarizer industry likely to expand its advantages in production capacity.