Earlier this week, a securities firm reported that several areas in China will begin raising LED chip prices in May due to recent adjustments to the LED chip market infrastructure in China. The report continued that the supply shortage is anticipated to intensify, which will cause a price hike in all LED chips. LEDinside reporters questioned several Chinese chip and package manufacturers to see if this is truly the case. 

HC SemiTek Vice President Bian Difei flatly denied plans to increase prices during a telephone interview with LEDinside. “We have no plans to hike up prices,” said Bian. He did confirm that the company is dealing with an inadequate production capacity and tight supply and demand situation, but stressed that there is no intention on increasing prices. 

Similarly, AquaLite also stated that the company would not be raising prices. “Whether or not there will be price upticks in the future depends on end market demand,” said Dong Zhijiang, General Manager. “If demand exceeds supply in the retail lighting market, Chip manufacturers will then have space to increase prices.”

Package manufacturers have received no notifications of possible plans to increase prices and believe that there is no possibility of it occurring.    

A representative of Refond Optoelectronics believes that LED chips will not increase in price. “We mainly purchase chips from San’an Optoelectronics, as well as from other manufacturers, none of whom have increased their prices,” the representative said. 

“Considering how the LED lighting market as a whole is already showing a downward trend in price, LED chip prices should begin to drop gradually in the future. For the time being, the prices will neither drop nor increase due to the undersupply issue plaguing the chip industry.” 

Inventory volume for LED chip manufacturers is currently relatively low. Package clients need to notify LED chip manufacturers in advance or they risk the chance of waiting for order shipments. The probability of chip manufacturers increasing price is slim. 

 “I have not heard anything about this news,” said HKLED General manager Yan Qianjun in regards to chip price uptick. 

”There has been no mention of plans to increase prices,” said Gong Wen, Kinglight Optoelectronics General Manager. LED chip manufacturers including San’an Optoelectronics, HC SemiTek, Silan Azure, and AquaLite have not announced any intention of hiking up chip prices.  

”Looking at the current market situation, the chance of chip manufacturers increasing price is slim,” said BONS Vice General Manger Wang Peng. BONS has received no notification of price increase from their main chip supplier San’an Opto. 

“Last year San’an Opto did increase prices once. However, after realizing that market share had become smaller, they immediately dropped prices back down,” said Wang. 

Wang continued: “Of course an uptick in chip price is not a horrible thing for package manufacturers, because if chip manufacturers raise prices as a whole, package component prices will also rise.”