According to the latest “2017 China LED Chip and Packaging Industry Market Report” by the LED Research Center of TrendForce, the size of China’s LED packaging market in 2016 was RMB 58.9 billion, a year-on-year increase of 6%, slightly higher than expected. In 2016, the price of LED remained stable, and the price of some products even increased. Driven by the small-pitch, automotive and lighting markets, the industry still maintained a growth trend. Looking forward to 2020, the scale of China’s LED packaging market is 73 billion yuan.
Trend 1: Chinese manufacturers continue to rise, and the domestic production rate continues to increase
Data show that in 2016 China’s LED packaging market, the domestic rate has risen by 67%. However, international manufacturers led by Nichia are still the main suppliers in the Chinese packaging market. Among the top ten manufacturers, international manufacturers occupy 5 seats, and Nichia ranks first, but the rise of Chinese manufacturers is obvious, representing the rapid development of the manufacturer Mulinsen. In 2016, it surpassed Lumileds to rank second, and Nationstar Optoelectronics and Hongli Zhihui ranked further.
Trend 2: China’s lighting LED market develops steadily
In 2016, the scale of China’s lighting LED market reached 25.9 billion yuan, lower than market expectations. The main reason is that the growth rate of international LED lighting demand is not obvious, resulting in a decline in China’s total LED lighting exports. However, due to the promotion of China’s domestic demand and stable prices, the lighting LED market will still maintain a growth rate of 9% in 2016. It is estimated that the lighting LED market will reach 28 billion yuan in 2017 and 36.4 billion yuan in 2020. From 2015 to 2020 The compound growth rate is 9%.
Trend 3: International manufacturers release lighting LED OEM orders
As low and medium power LEDs are sweeping the LED lighting market, more and more international brand manufacturers, including Lumileds, OSRAM, CREE, Samsung, LGInnotek, etc., are gradually concentrating OEM orders in China, making the capacity utilization rate of China’s first-tier manufacturers Stay upscale. The top five Chinese lighting LED manufacturers are Mulinsen, Hongli Optoelectronics, Tiandian Optoelectronics, Refond Optoelectronics, and Zhaochi Energy Saving.
Trend 4: Small-pitch display drives the demand for production capacity expansion of various factories
According to LEDinside’s analysis, due to the rise of small-pitch displays, display LEDs still maintain a growth trend. It is estimated that the display LED market will reach 15.8 billion yuan in 2020. In the field of small-pitch display LED packaging, EVERLIGHT was the mainstay in the early days. At present, many Chinese manufacturers have entered this field, including Nationstar Optoelectronics, Mulinsen, and Jingtai Optoelectronics. This has also driven the demand for production capacity expansion of various factories.
At the same time, the demand for quaternary LED production capacity has also increased. According to the analysis and statistics of LEDinside, Sanan Optoelectronics, Wuhan Huacan, Qianzhao Optoelectronics and Epistar all have the demand for quaternary LED capacity expansion in 2017.
Trend 5: China’s domestic MOCVD is gradually rising, which will further reduce the cost of Chinese manufacturers
According to the data, the total number of MOCVD machine shipments in 2016 was about 136. Most of Veeco’s machines are EPIK700 with a large cavity, so if they are converted into K465i machines, the number of equipment machines after conversion ranks at the top. China’s MOCVD equipment manufacturers including AMEC, Topecsh and other companies are gradually rising, although the total market share in 2016 was only 11%. However, after the client verification in 2016, it will enter the supply chain of Chinese LED chip manufacturers in 2017.
In the past, MOCVD equipment was controlled by European and American companies, but as China’s domestic MOCVD equipment began to pass the verification of Chinese LED chip manufacturers, it will be introduced to some LED chip manufacturers in 2017. Since the equipment is relatively cheap, it will be expected to further reduce the cost.
Trend Six: Rapid Expansion of Market Demand for Filament Light Bulbs and Filament LEDs
In the past two years, due to the popularity of LED filament lamps in Europe, North America, and Australia, more and more manufacturers have entered the field of filament lamps, and the market size has also shown rapid growth. In 2016, the global market demand for LED filament bulbs was 150 million. It is expected that LED filament lamps will continue to maintain rapid growth in 2018, and the global market demand is expected to reach 600 million. In terms of packaging product supply, major filament LED suppliers include Yuanlei Technology, Mulinsen, Refond Optoelectronics, and Hangke Optoelectronics.