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LighTimes: Displaybank Forecasts Demand for Precursor will Double with Expected LED Market Boom

14 Aug 2013

August 12, 2013…Global demand for precursor, a material used in manufacturing of LEDs, is set to more than double from 2012 to 2016, as the market for LED lighting booms, according to Displaybank, now part of IHS. Displaybank predicts that the market for precursor used in the metal-organic chemical vapor deposition (MOCVD) manufacturing process for making LEDs will rise to 69 tons in 2016, up 114 percent from 32 tons in 2012, as presented in the figure.

“The boom in the precursor market reflects the rising operating rate of MOCVD as the LED lighting market grows,” said Richard Son, senior LED analyst at IHS. Precursor is used in the MOCVD process in manufacturing LED chips. Major precursors include trimethylgallium (TMGa), trimethylindium (TMIn), trimethyl aluminum (TMA), triethylgallium (TEGa) and C2Mg2. Among these, TMGa is the most widely used and commands about 94 percent of total demand.

IHS expects Global shipments of MOCVD equipment to climb by 17 percent in 2013. South Korea, Taiwan and China, the largest buyers of MOCVD equipment, account for about 80 percent of the global demand of precursors. China, which is generating the highest growth in installation of MOCVD equipment, is expected to make up 45 percent of the global demand of precursors in 2016. In the early stage of the LED market, Dow Chemical Co. was the unrivaled leader in the precursor market. However, new players have been investing in R&D and manufacturing facilities while breaking into the market with low prices for similar-quality product.