Over-investment has caused rising inventories in the sapphire industry. Although demand has been returning in the first-half of 2013, to reduce inventories, sapphire prices are unlikely to show any strong increase.
Digitimes Research predicts prices of 2-inch sapphire substrates for LED applications to be around US$8/unit in 2013.
US-based sapphire crystal growing firm Rubicon and South Korea-based Sapphire Technology Company (STC) both saw falling 2012 revenues compared to 2011. In 2013, Rubicon has been lowering its percentage of 2- and 4-inch products and shifting focus to 6-inch silicon-on-sapphire (SoS) products, hence revenues are unlikely to show a strong rebound. Digitimes Research predicts Rubicon's 2013 revenues to be US$55.80 million. On the other hand, STC has downstream customers such as LG Innotek and Seoul Optodevice and has been aggressive in expanding sales in the international market. The firm's 2013 revenues are expected to reach US$62.90 million, said Digitimes Research.
In 2013, the top-seven firms' combined market share is expected to reach 85%, while the combined market share of the top-three makers, Monocrystal, STC, and Rubicon, is likely to be 56%.
Some China-based solar firms have been entering the sapphire crystal growing market over the past two years, but due to low yields and price drops for sapphire for LEDs, many newcomers have exited the market. The sapphire market is likely to continue being dominated by firms with experience.
