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Digitimes Insight: South Korea LED supply chain unaffected by Japan earthquake
Willie Teng, DIGITIMES, Taipei [Wednesday 16 March 2011]

South Korea's LED supply chain relies on Japan's Kyocera and Namiki for sapphire substrates, and Nichia and Toyoda Gosei for epitaxial wafers, chip packaging and LED phosphor materials.

Among the Japan-based companies, Namiki was hit the hardest by the recent earthquake offshore of Japan. Nichia and Toyoda Gosei were relatively unscathed.

In sapphire substrates, South Korea's Sapphire Technology Company (STC) and Astek already have ingot production and slicing capability. Iljin Display and Hansol Technics (formerly Hansol LCD) also have ingot slicing operations. With Hansol Technics and LG Siltron expanding to upstream sapphire substrates since 2010, South Korea has become less reliant on overseas supply sources. Hence Namiki's production disruption should have little impact on South Korea's LED industry.

Additionally, as STC now has the world's largest capacity for LED-use sapphire substrates, Namiki's share of the South Korea LED market has been down for quite some time.

As for MOCVD equipment, South Korea LED chipmakers mainly rely on Germany's Aixtron and US-based Veeco, and hence, the earthquake has not affected equipment supply to the country. From epitaxial wafers to chip packaging, South Korea has sufficient capacity within the country, plus Nichia and Toyoda Gosei sustained only minor damages.

However, South Korea still needs to improve its own capacity in phosphor material production. Though, as mentioned, Nichia and Toyoda did not sustain serious damages, shipments from Japan to South Korea could be impacted by air and sea traffic delays.

Overseas and domestic suppliers of South Korea LED supply chain

South Korea

Overseas

MOCVD equipment

AP System, Top Engineering, Juseng Engineering

Aixtron, Veeco

Phosphor materials

Force4, Daejoo Electronic Materials

Nichia, Toyoda Gosei, Osram

Sapphire substrates

STC, Astek, Iljin Display, Hansol Technics

Rubicon, Monocrystal, Kyocera, Namiki

Epitaxial wafers

Samsung LED, LG Innotek, Seoul Optodevice, EpiValley

Nichia, Toyoda Gosei, Cree, Osram, Philips Lumileds, Epistar

LED chip

Samsung LED, LG Innotek, Seoul Optodevice, EpiValley

Nichia, Toyoda Gosei, Cree, Osram, Philips Lumileds, Epistar

Chip packaging

Samsung LED, LG Innotek, Seoul Semiconductor, Alti-Electronics

Nichia, Toyoda Gosei, Cree, Osram, Philips Lumileds

Source: Companies, compiled by Digitimes, March 2011

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