China LED chip market demand from 2009 to 2010 the basic supply and demand balance, 2011 oversupply, 2012 has been a serious oversupply, the 2013 adjustment phase. After 2014, driven by lower market demand, LED chip demand will begin to enter the stable growth of large industry consolidation phase. After 2013, Chinese local governments are no longer blindly support all the LED chip business, but concerned about the small number of outstanding key enterprises. Thus, the entire LED chip industry 2013 with an annual capacity expansion is very limited, only leading enterprises began to seek expansion at this stage, and the capacity expansion is mainly based on demand. From the listed companies, the 2013 production capacity mainly HC SemiTek mainly HC SemiTek listed after 2012 were large-scale capacity expansion; Sanan Optoelectronics the additional expansion of production capacity is expected to be in 2014 at the end of production. 2013-2015 LED lighting rapid growth, with production capacity should be additional demand will quickly digest. According to "2014-2018 China LED industry market strategic planning and investment analysis report" Industrial Research Institute released data display, LED chip to enhance light efficiency of 20-25% per year, if prices remain unchanged, LED chip gross margin improvement , it is expected that in 2014 there may be LED chip shipments and gross margin dual-liter cases. Forecasts the market size 2014-2020 China LED chip will maintain an annual average growth rate of 11.85 percent growth, the scale of China's LED chip market demand of nearly 17.5 billion yuan in 2020. It is understood that due to the LED chip industry profits shrink, LED products into parity period, many companies want to rely on more profitable to expand the scale, China MOCVD capacity utilization is only about 30% currently, around the boot was only 50%, while the downstream lighting market greater demand relatively strong, but due to many years of capacity expansion and utilization is not high, causing huge loss machine, so the LED industry, mainly in the future to integrate existing resources mainly to expand production capacity may exist in several major listed companies probability .