Rising Chip Prices & Geopolitical Uncertainty Threaten Display Panel Production

South Korean Display Makers Monitor US Iran Conflict as Inflation Risks Rise​

Industry Leaders Warn of Rising Raw Material Costs​

Seoul, March 12: Executives from leading South Korean display manufacturers said on Thursday that they are closely monitoring the potential impact of the ongoing conflict between the United States and Iran, warning that prolonged tensions could drive inflation and raise production costs across the industry.

Samsung Display Chief Executive Officer Yi Chung said the conflict could significantly increase the cost of raw materials if it continues.

Speaking to reporters ahead of the general meeting of the Korea Display Industry Association in Seoul, Yi stated that a prolonged war would likely place additional pressure on production expenses.

“If the war continues, the cost of raw materials will rise significantly,” Yi said.

Inflation and Rising Chip Prices Add Pressure​

Yi also pointed to broader challenges facing the industry, particularly the rise in memory chip prices driven by strong demand related to artificial intelligence technologies.

He noted that while memory chip producers may benefit from stronger pricing, companies that rely on those chips for manufacturing devices are encountering growing difficulties.

“While conditions are not favorable due to rising memory chip prices, the war between the United States and Iran is expected to lead to inflation, making the situation even more difficult in the second half,” Yi said, according to Yonhap news agency.

The increase in global memory chip prices has raised concerns within the electronics supply chain. Industry participants believe higher component costs could force smartphone manufacturers to cut shipment volumes, which may ultimately weaken demand for display panels.

Yi emphasized that companies must focus on controlling costs and strengthening partnerships to remain competitive.

“The performance of memory chip producers may be strong, but clients using memory chips are facing challenges,” he said, adding that reducing production costs and collaborating with partners would be essential.

LG Display Also Monitoring Middle East Situation​

LG Display Chief Executive Officer Jeong Chul dong said the company is also closely observing developments in the Middle East, although the conflict has not yet had a direct effect on its operations.

Jeong noted that rising memory chip prices are already pushing up the prices of finished products, prompting the company to evaluate possible impacts on its business.

“The prices of finished products are rising due to higher memory chip prices, and we are currently assessing what impact it may bring,” Jeong said.

He added that LG Display plans to respond based on changes in memory chip supply conditions.

Focus on Financial Stability and Profitability​

Jeong said the company will continue efforts to strengthen its financial health and ensure stable profitability.

According to the report, LG Display aims to maintain steady performance during the first half while adapting to changes in supply and cost conditions in the global technology market.