China's major TV vendors are not expected to increase their purchase of LCD panels from Taiwan next year, with the procurement amount staying at US$5.3 billion for both 2010 and 2011, according to Bai Weimin, chief secretary of the China Video Industry Association (CVIA).

Bai, head of a delegation representing China's nine largest TV vendors in procurement talks with Taiwan suppliers, said she is confident that the TV panel purchase amount this year will reach US$5.3 billion despite the currently high inventory levels at China vendors.

Although the procurement for LEDs has yet to be decided, the total amount should be significant enough to forge closer cooperation in the LED backlighting segment between Taiwan and China, she said.

China has relied heavily on imports of LCD TV panels. But China's LCD panel makers are now gearing up their capacity expansion, with several 6G or more advanced production plants scheduled to start production at the end of 2011.

But a CVIA official pointed out that China's procurement of LCD panels from Taiwan will remain high in 2011 because it is uncertain whether its advanced panel fabs will actually be able to enter volume production in 2012.

AU Optronics (AUO), Chimei Innolux (CMI) and Chunghwa Picture Tubes (CPT), under the arrangement by the government-sponsored Taiwan External Trade Development Council (TAITRA), signed a memorandum of understanding (MOU) with nine China-based consumer electronics vendors in Beijing on January 20 for 2010 supply of panels worth about US$5 billion.

The Bai-led delegation was in Taiwan Wednesday to reiterate their commitment to the MOU.

China is expected to produce over 100 million TVs in 2010, of which 80 million will be LCD sets, Bai noted, adding that China produced a total of 98.99 million TVs in 2009, of which 22 million were CRT models and 2-3 million units were plasma sets.

The CVIA expects China's domestic LCD TV market to reach 37-38 million units in 2010, and Taiwan panel makers will provide 50% of the panels, with 30% of them being LED-backlit.

The global TV market is expected to reach 242 million units in 2010, according to DisplaySearch data.