Samsung Halts All Panel Procurement Amid Inventory Glut: DSCC

Samsung stopped issuing new flat-panel purchase orders and canceled current orders amid an industry-wide inventory glut, blogged Display Supply Chain Consultants President Bob O’Brien. Samsung’s action “is the most recent and most dramatic of a larger picture of oversupply and excess capacity in the LCD industry,” said O’Brien Monday. Though the surge in consumer TV demand early in the COVID-19 pandemic caused a panel shortage that lasted until mid-2021, “price increases led LCD makers to increase supply while the demand peaked and started to decline,” he said. “The result has been a growing pile of inventory.” The excess inventory, continuing oversupply and anemic demand “will continue to put pressure on LCD panel prices across all applications,” said O’Brien. “Prices have reached cash costs for many panel makers but they may go even lower as companies try to raise cash by selling off excess inventory. A pattern of declining prices also sends a message to purchasing managers to delay purchases in order to get lower prices, so it may take some time for inventory to clear before the industry hits bottom.” Samsung didn’t comment Tuesday.