The supply and demand relationship in the LED market has changed subtly, and chip packaging companies have become popular in signing "marriage contracts"

The recovery of the LED terminal market in 2013 stimulated packaging factories to expand production. The resulting packaging production capacity will usher in a concentrated release period in 2014. However, the chip production capacity expansion cycle is relatively long, so the chip supply and demand relationship has undergone subtle changes. However, due to the relatively dispersed supply power and high price stickiness, chip factories have been unable to launch large-scale price increases, making the chip shortage situation intensified. In 2009, the LED industry experienced an extreme shortage of chips caused by the outbreak of the backlight market. Packaging factories were shut down on a large scale due to lack of materials. In order to avoid repeating the same mistake, signing supply and demand agreements with chip factories and establishing an offensive and defensive alliance can be regarded as a strategy to ensure the security of the supply chain, Wang Fei, a senior analyst at LEDinside, pointed out.