LONDON, March 25, 2024 – Omdia’s latest Display Glass Substrate Market Tracker indicates a tight supply-demand balance is anticipated from 2Q24 to 4Q24, with the potential for a significant glass shortage in case of minor accidents or sudden order spikes. This scarcity is expected to drive up prices, reflecting the evolving dynamics of the display glass market.
“Glass manufacturing is a typical heavy industry. Five years ago, major display glass makers such as Corning, AGC, and NEG traditionally maintained a two-month inventory, recognizing the lengthy recovery process in the event of glass tank accidents,” comments Tadashi Uno, Research Manager for Display Components and Cost at Omdia. Display glass prices have been falling for many years and recent energy cost inflation is impacting the financial results of glass makers.
In response, Corning raised glass prices in 2023 and is seeking further increases in 2024, with other makers following this trend. In contrast, glass makers are trying to control their capacity by aligning to shipment areas to optimize profitability as AGC almost finished display glass production in Japan in 2023. NEG and AGC have almost aligned capacity to shipment area now, after the former closed its Korean factory in 2023 and AGC scaling back production in Japan last year.
Conversely, Chinese domestic glass makers are accelerating investments in new glass tanks, with plans to invest in over 30 tanks beginning in 2022 and up to 2025. “Theoretically, this could alleviate concerns about display glass supply/demand tightness in 2024. However, despite the rapid increase in Chinese FPD glass capacity, local producers have yet to capture significant market share beyond a few Gen 5 and Gen 6 fabs in China. It will take them three to five years to increase their share at Gen 8.6/8.6 lines,” Uno adds.
Chinese OLED makers have been raising factory utilizations since 3Q23, driven by surging OLED display demand. This increased demand has led major glass makers to receive heightened levels of demand for LTPS and LTPO substrate and carrier since 3Q24. However, both AGC and NEG faced challenges with LTPS glass production recently, leading both manufacturers to change an-Si glass tank to LTPS glass production. These glass tank allocation changes are now causing tightness of the total glass supply. “Unlike more than five years ago, one tank allocation change wouldn’t have significantly impacted glass supply/demand due to inventory and capacity room. This exemplifies the typical tightness of the Display Glass market,” concludes Uno.
