Excess supplies of large liquid crystal displays (LCDs) are forecast to peak in the third quarter of this year, but will balance out by the fourth, a U.S. research firm said on Friday.

Strong supplies and disappointing demand meant global supply of the LCDs exceeded demand by 6.4 percent in the second quarter, and the gap was set to widen to 9.3 percent in the current quarter, said El Segundo, California-based iSuppli Corp.

"The oversupply situation is expected to persist through the third quarter as eight new LCD fabs are expected to start production this year," iSuppli said in a report.

"Panel prices are coming down significantly for LCD televisions. However, consumer prices are still not low enough for demand to meet suppliers' expectations."