Falling prices and weak demand expectations for large-area thin film transistor (TFT) liquid crystal display (LCD) panels have caused panel makers to adjust their production strategies, according to a recent report.

As panel prices approach cash cost, manufacturers are reducing capacity utilisation. According to the quarterly large-area Production Strategy Report compiled by DisplaySearch, a market research and consulting company, global TFT LCD glass input peaked in the second quarter of 2011 at a record 14.2 million square metres per month.

However, global glass input will be reduced to 12.2 million square metres per month in the third quarter, a 14% drop between quarters and 5% growth from 2010. As the market outlook is still unclear, panel makers are planning to maintain input at 12 million square metres per month in the fourth quarter.

Shawn Lee, Senior Analyst for DisplaySearch says: “We have seen very different results this quarter. While panel makers planned to raise utilisation rates to 85-90% in quarter three, they are now projecting only 75%.”