Fluorescent market chaos: order imbalances

[Source: "High-tech LED - Research and Review" July issue Hu Yanling]

The LED phosphor market is beginning to show signs of vicious competition in prices.

“The YAG phosphors in the white light market are very competitive,” said a person in charge of a large packaging company. Two phosphor companies had to supply them. In order to take orders, the two companies successively pressed the price and finally won. That offer is one-third lower than the original two.

"Before the price of YAG phosphors has been maintained at 15 yuan / gram, this price cut is indeed a market signal, the price war is on the verge of launch." Researcher Rare Earth Marketing Manager said to the high-tech LED reporter in the summer.

“Before the market competition was more orderly, the market order could be maintained and balanced, and with the rise of local enterprises and the participation of foreign companies, the competition became more intense and the market order began to be out of balance.” Dr. Liu Xiao, General Manager of Intermec Said.

According to the High-Tech LED Industry Research Institute (GLII), there are currently more than 50 LED phosphor companies sold in mainland China, including 25 import companies and 25 local companies. The 50 companies compete for a market of around 30 tons (2012 market share), and the market's tragic extent is evident.

"LED phosphors are typical products with small quantities and low prices. Although the market demand is not large, the profits are very high. Everyone wants to share a piece of it here, so it is not excluded that some companies will snatch the market in a vicious way." An insider said.

Quarrel

The market share has been eroded by other companies, and Hongda, China (hereinafter referred to as Hongdae) is a little anxious.

It is reported that Hongdae is the first company to sell LED phosphors in mainland China. It was once the "one-party leader." In the past few years, although the price of phosphors of Hongdae has been at a high level, the pattern of this one alone has caused domestic packaging companies to sometimes encounter the situation of “holding money but not buying goods”.

In 2007, the rise of the United States and the United States in a timely manner, in response to Hongda's advantages in small and medium power, another way to create a medium and high power product line. Also because of its good packaging model (registered in the US), Intermec quickly opened up the mainland market. This not only gives mainland packaging companies a choice, but also forms a strong market structure with Hongdae.

Beginning in 2009, as local phosphor companies began to emerge, Hongdae’s market share began to be eroded. An industry analyst pointed out: "The original research and development of local phosphor companies is based on Hongda products, and they claim to do better than Hongdae. The product's step by step also adds to the huge advantages in cost and price. The company has seized a place in the market and once squeezed Hongda’s market share."

At present, Hongdae's market share in mainland China ranks second, with an average monthly shipment of around 300 kg; and the top ranked is Intel, with monthly shipments of around 800 kg (excluding The sales volume from the United States through third countries to mainland China); the third is to research rare earth, the monthly shipments are currently about 200 kg. Other local companies include Beijing Nakamura Yuji, Sichuan Xinli Light Source, Jiangsu Borui, etc., and imported companies include German Dino and Japanese Mitsubishi Chemical.

On the one hand, the rise of local companies, on the other hand, foreign companies are also not satisfied with selling products through the agent model, they expect to be closer to their customers by another way.

In March of this year, Mitsubishi Chemical officially announced the capital increase in Beijing Nakamura Yuji. At the same time, Beijing Zhongcun Yuji announced the investment of 50 million LED high-end phosphor projects. According to a related person from Beijing Nakamura Yuji, Mitsubishi Chemical's LED nitride red powder has an absolute market share in overseas markets. This time, with the selection of Nakamura Yuji, it is expected to quickly open the Chinese market with the help of local companies' marketing channels.

According to GLII statistics, more than two-thirds of the world's packaging capacity will be in China in the future. With the agglomeration effect, China's mainland will be a must for LED phosphors, and market wars will be on the horizon.

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