Sapphire substrates for LEDs in shortage

Sapphire substrates for LED chip production is in shortage and the supply will remain short until the end of 2010, according to market sources. The prices of sapphire substrates are expected to increase by over 20% in the second quarter of 2010, the sources added.

The shortage will have little impact on LED's share in the TV backlighting market, as makers are likely to reduce production for LED lighting and shift capacity to backlighting, the sources said.

Samsung Electronics recently stepped up sourcing sapphire substrates from Taiwan due to the shortage, with prices of 2-inch wafers increasing 20% over the past two quarters, the sources said.

Lextar, a LED subsidiary of AU Optronics (AUO), indicated that the company is validating samples from several suppliers, and that LED chip supply will remain short in the next three years.