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Demand-supply gap in LED industry to shrink by 2018

Demand-supply gap in LED industry to shrink by 2018

By BizLED Bureau

Jan 4, 2016: According to industry insiders, oversupply in the global LED market will ease to about 8% by 2018, as demand for LED lighting and LED products will grow in the next two years.

The global LED market witnessed overcrowding in 2015 as LED demand-supply margin touched 33% by 2015.

Industry analysts now forecast that as demand for LED lighting will increase in the next two years, the global supply glut will decrease to 8% by 2018, from 33% in 2015.

The surplus in 2015 had led the average prices of LED lighting to dip to about 30%. As a result of this scenario, some manufacturers have exited the market while some have entered strategic partnerships to cope with the situation.

Taiwan-based LED chip-maker Epistar Corp had also suffered losses due to dipping prices of LED lighting products as the market was overcrowded which in turn led to oversupply. The company said that in December it developed omni-directional LED filament light bulbs with mainland China’s LED packaging service provider MLS.

Upcoming changes in China’s policy regarding the LED industry, including a gradual tapering and redistribution of subsidies may also reduce supply if they lead to manufacturers exiting the market, analysts say.

Huge financial subsidies and government incentives have given huge upper to the manufacturers and the LED industry in China have become the world’s largest manufacturing base for LED lighting.

 

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