LED is undergoing a fundamental change in the pattern of supply and demand

Lighting and small spacing LED demand side is a long-term good, so the next 2 to 3 years will continue to significantly stimulate the downstream demand of LED industry chain; while LED whole industry concentration and constantly improve, improve the overall industry access threshold, new entrants will be reduced, due to gradually withdraw from government subsidies in 13th Five-Year in the planning, in which the LED chip supply side disorderly production is inhibited, the upstream industry chain is rising bargaining power, so to sum up we can feel LED, the overall supply situation is undergoing profound changes. LED industry supply and demand structure significant signs of improvement, the upstream prices frequently, downstream outstanding performance a sign: 2016 LED industry chain upstream prices frequently, some products rose more than 15% in March, Taiwan Linsen packaging companies have crystal prices for some products in the production; May EPISTAR 25%, prices rose 15% Sanan optoelectronics and some products also have a slight price increase; in August, three chip enterprise prices are rising to varying degrees, including small and medium size three optical product prices go up 10%, HC semitek of low profit products for the corresponding adjustment; September, nationstar, Linsen XinDa to raise prices of photoelectric RGB lamp rose, at about 5%-10%. According to the survey, in 2016 the end of the 2 quarter, the number of LED chip companies prices have started to rise again, significant improvements in revenue. The crystal as an example, at the beginning of September, crystal electric full capacity and lasted until October, the capacity utilization rate has reached more than 9, the Blu ray machine production capacity of about 90%, the price and profit of better production line is full of red. According to the data, we see the average price of mainstream package has stabilized, compared to the 2015 package prices 50%~60%, the overall package relationship between supply and demand has been dramatically improved, which can see the larger package size 5630 and 3030, 3-4 month decline since April but has stabilized, and the package size 2835 price this year has remained stable, and some products prices rose slightly in July. The package of Dachang billion light as an example, since the 6 months since, the stock rose 18%, has seen demand fully warmed up all product lines. At present, the third quarter will be officially entered the peak season, not only is the inventory. Especially the TV backlight performed best, mainly by the Olympic year demand this year, driven by ratings; mobile phone backlight, display screen and other orders will also contribute significantly to the third quarter revenue from the other. According to the data, the global LED bulb fell by about 9%, compared to 2015 the global 40W lighting alternative prices fell 12.4%, instead of the 60W bulb prices fell 9.9%, basically in the normal range, the overall supplies mainly due to packaging technology progress caused by the reduced price decline. At the same time, Chinese LED bulb price fell by about 11%, compared to 2015, China replaced the 40W bulb price fell 18.4%, to replace the 60W bulb price fell 32.37%, fell sharply trend has stabilized, the domestic lighting market competition reaction environment has become increasingly stable, the supply and demand pattern has gradually changed for the better. Signs LED chip has changed the pattern of supply and demand. Sign two: 2016 LED lighting business revenue usher in a turning point, a number of enterprises revenue grew over 40% downstream of LED lighting business revenue significantly improved, to verify the LED lighting supply and demand pattern has ushered in a turning point, reversing 15 years decline pattern. Verify from the number of Listed Companies in the first half of 2016 revenue, the sun and the Foshan revenue grew 40%, NVC revenues rose more than 90%, is due to the first half of the 15 years LED lighting application of a low base, also reflects the worst time is spent, the supply and demand situation in 2016 downstream LED lighting applications have taken place in the whole the inflection point. Demand side: LED lighting penetration of space is still large, small spacing ushered in the outbreak by UBS data show that in 2015 the end of the LED chip demand has exceeded 90 thousand square inches, is expected in 2016 will still be able to 20% growth, although with the LED chip luminous efficiency, LED backlight source of demand for the area of the chip will have a certain decline but with the LED lighting penetration further improved, and the outbreak of small spacing requirements, therefore will continue to promote stable LED chip on the demand side. From the demand side analysis: LED lighting penetration rate of only 27.2%, "forbidden Bering LED replacement catalytic LED lighting penetration rate of only 27.2%, October 1st" cut Bering "prompted the LED lighting to replace incandescent lamp white. 1) lighting applications market, mainly downstream of LED WIND data in Chinese roughly accounted for about 45%. According to DIGITIMES data, the global LED lighting market in recent years has also increased significantly, from $1 billion 750 million in 2009, increased to $29 billion 900 million in 2015, during the annual compound growth rate of 60.5%. But its penetration is still not high, only 27.2% in 2015, 16 years is expected to exceed 30%. Therefore, the growth space is still huge; 2) according to China's national development and Reform Commission and the five ministries issued in November 2011 "China phasing out incandescent roadmap", finally our country is implementing the incandescent lamp out in September 30, 2016, October 1, 2016, 15W and above ordinary incandescent lighting is banned the sale and import of. This was interpreted by the industry as the "forbidden Bering" in full swing, the further release of LED lighting market demand. Domestic incandescent lamp replacement stock of huge space, on 2016 the first half of the cumulative production of 2 billion 12 million incandescent bulbs, the monthly output of 3-3.5 million. According to the CSA Research data, 15