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World demand for materials used in flat-panel and CRT (cathode ray tube) displays is expected to grow a strong 12 percent annually through 2008, reaching nearly U.S. $22 billion, reports market research firm The Freedonia Group.
Gains will improve over the 1998-2003 period, with rapid growth in materials for flat-panel displays more than offsetting declines in CRT materials. According to Freedonia, flat-panel display materials will benefit from improving economic conditions in developed nations that will both drive increased demand for personal communication devices and notebook computers, and -- along with rapidly falling prices -- accelerate the replacement of the existing installed base of CRT monitors and televisions with newer flat-panel alternatives. The replacement trend, however, will also be responsible for continuing losses in demand for CRT materials.
Freedonia expects glass to remain the single largest material component, though growth will be weak in comparison to the rest of the industry as losses in the CRT display market (where glass accounts for a disproportionately large portion of material demand) are barely offset by strong volume-led gains in flat-panel glass. This will allow chemicals and coatings and films -- the two fastest growing components due to their much greater use in flat-panel displays -- to significantly increase their overall market presence.
By 2008, chemicals/coatings and films are expected to account for about 26 percent of market demand, with a slight advantage being held by the chemicals segment. CRT and flat-panel material demand will become even more concentrated in the Asia/Pacific region, rising to more than 90 percent of total world demand in 2008 as display production increases rapidly in countries such as South Korea, Taiwan, and China.
Flat-panel material demand will be focused in South Korea, Taiwan, and Japan, with a growing share in China as well. CRT material demand will be more diffuse worldwide, as some existing CRT production will continue in the Americas and Europe. In particular, production in Eastern Europe -- while still slightly declining -- will hold up much better than the rest of the world. Most CRT material demand, however, will continue to be found in the Asia/Pacific region, with China having the largest share.
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