Smartphone supply chains expect strong orders throughout July and into August as vendors prepare to release new units, according to industry sources.

Demand cooled off in the second quarter of the year due to slower-than-expected development of 4G devices in markets such as China in addition to high reserves from vendors. However, telecom providers and handset vendors have since resolved related issues and expect demand will increase for new smartphones in markets both in and out of China.

Panel makers and touch panel makers can expect to benefit from the demand, and the new smartphones are expected to be large-sized overall.

Touch panel price wars are also continuing to ease which will aid in makers' performances in the third quarter as well, the sources said.