Better-than-expected sales during the Lunar New Year holiday in China helped digest panel inventory levels in the system-end market, and with the upcoming Labor Day holidays in May, replenishment demand is expected to show up in March helping to increase panel prices and shipments, according to panel makers

LCD TV sales during the Lunar New Year holiday in China in 2011 increased 28% on year to 2.75 million units, higher than the estimated 2.63 million units. The growth was mainly due to surging demand in rural areas and narrowing price differences between LED-backlit and CCFL-backlit models.

Despite the expected increase in panel prices and shipments in March, revenues of panel makers are expected to drop to the bottom in February due to fewer working days. First-tier panel makers are expected to remain in the red for the first quarter of 2011, and may break even or turn profitable in the second quarter. With the third quarter being the peak season, first-tier and second-tier panel makers are all expected to turn profitable in the quarter.