Panel Price Hikes Drove 44% Rise in Cost of Average April TV Import

Persistently strong consumer demand and rising LCD panel prices were evident in TV imports to the U.S. for April and in the year’s first four months, according to new Census data accessed Monday through the International Trade Commission’s DataWeb tool. Increases in TV unit volume reached well into the double digits for all screen size classifications for January-April, as did spikes in the average customs value of sets shipped from the top countries of origin, except for China.

The escalation in TV pricing “really is unprecedented,” Display Supply Chain Consultants Co-Founder Bob O’Brien told us Monday. Pricing on 32-inch LCD TV panels alone “increased by more than 100% from April 2020 to April 2021,” he said. “That magnitude of panel-price increases is also unprecedented. In all the time I’ve been in the TV industry, which dates back to the 1980s, you never saw TV prices increase. You saw them decrease slowly or decrease quickly. Now we’re actually seeing prices increase, which is pretty striking.”

The never-before-seen increase in prices for LCD TV panels “will soon come to an end” as the demand surge that resulted from the COVID-19 pandemic eases and “industry supply has caught up,” blogged DSCC Monday. “We expect prices to peak in June 2021 for some sizes and in July for others, and to decline for the rest of 2021. Even with the declines, prices at year-end will remain higher than they were in December 2020 and dramatically higher than their all-time lows.”

U.S. importers sourced 3.51 million TVs from all countries in all sizes in April, increasing marginally from March, but up 44.4% from April 2020, said DataWeb. Dollar volume of those shipments climbed a staggering 107.6% year over year, reflecting a 43.9% increase in value of the average imported set to $303.94. January-April TV unit imports were up 26.8% from a year earlier to 10.36 million sets and rose 12% in average value to $284.72.

There’s a “time lag” between a panel price increase and the rise in the average value of a TV import embedded with that higher-priced panel, said O’Brien. “It would make sense” that if panel prices were rising in previous quarters, then the increase in the customs value of the average TV import would be higher in April than it was in January, “and that’s what the data says,” he said. Panel prices were rising “rather steeply” in Q4 and Q1 and into Q2, he said. “Just based on that, you would expect that the average TV price would continue to increase well into Q3.”

Mexico, the largest source of TV imports to the U.S. and the biggest haven for premium-priced product, shipped 2.12 million sets here in April, 109.9% more than in April 2020, said DataWeb. The average Mexican TV was worth $393.32 in April, up 31.3% from a year earlier, higher than the 20% increase in average value to $316.77 of Mexican imports for January-April. Mexico generated 56.4% of all TV imports to the U.S. in that period. Its 7.41 million sets were up nearly 17% from January-April a year earlier.

Chinese TV imports to the U.S. declined 27.6% year on year in April to 663,000 sets, and their average value of $161.36 was only 0.9% higher than in April 2020, said DataWeb. China was accountable for about a quarter of TV imports to the U.S. in January-April, its shipments rising 38.9% to 3.32 million, but their $159.28 average was down 2.6% from a year earlier, in stark contrast to other TV exporting countries.

Difficult comparisons with the year-earlier month help explain the double-digit decline in April Chinese TV imports, said O'Brien. Consumer TV demand in April 2020 spiked “dramatically because of the stimulus checks,” catching the supply chain flatfooted, he said. With the onset of the pandemic in Q1 2020, “everybody panicked and purchasers stopped buying,” he said. “The supply chain needed to react from not supplying anything to all of a sudden supplying everything.”

In the more “normal” supply chain, TV makers would ship their panels to Mexico for assembly into finished TVs for import into the U.S., said O’Brien. “But if you’re really in a hurry, you’ll make those TVs in China and ship them direct from China.” That behavioral shift caused a surge in TV imports from China that began in April 2020 and filtered into May and June, he said.

Vietnam, by comparison, shipped 1.22 million sets to the U.S. in January-April, generating 9.3% of all TV imports, nearly three points of additional share from a year earlier, said DataWeb. They were worth $134.63 in average value, 19.4% higher than in 2020. The average Vietnamese TV import in April increased 42.8% in value year on year to $148.70. But Vietnamese shipments for the month were down 7.5% to 295,000 sets.

January-April TV unit import growth was robust for all screen-size classifications, especially in the Harmonized Tariff Schedule’s 8528.72.64.40 subheading for sets with 35- to 45-inch screen sizes, said DataWeb. U.S. importers sourced 3.29 million of those sets from all countries in the first four months, an increase of 37.7% from the same 2020 period, the highest growth rate of any screen-size classification. Sets in that class also had the highest year-on-year growth in average value -- 23.2%, compared with 11.7% for TVs with screens exceeding 45 inches, and 14.3% for sets with 30- to 35-inch screens.

Imports of HTS 8528.72.64.60 TVs with screens exceeding 45 inches were the largest unit and dollar category for January-April, said DataWeb. Shipments increased 23.4% to 7.17 million sets. Dollar growth in the segment outstripped unit growth, rising 37.7% to $2.85 billion.