The market still remains in a poor state with supply outstripping demand in almost all product categories. Wireless technology, the sensor market, and a high demand for larger capacity and faster memory chips are all driving the market forwards for consumers, manufacturers and distributors alike. Although we have said it in previous updates, it remains vital that Original Equipment Manufacturers (OEMs) provide their Electronics Manufacturing Services (EMS) partners with sales forecasts as far out as possible so that supply chain disruption can be minimised. Available stock in the marketplace continues to reduce with high service distributors taking advantage and increasing pricing even on commodity lines.
Key Capacity and lead-time issues
Micron are still experiencing difficulty in fulfilling open orders through distribution but have plans in place to open a new fab in Singapore to make 3D NAND Flash.
All Micron lines remain on allocation.
MLCC shortages have been reported to extend into 2020.
Vishay’s fab constraints are much the same as they were in January.
Lead-times for certain families of diodes manufactured by On Semiconductor/Fairchild and Nexperia are over 30 weeks, in some cases allocation with high MOQ’s.
Toshiba memory lines are on allocation.
Yageo added 15% to pricing during Q1, with a further 11% expected in Q2
It should be considered, that supply vs demand will lead to increased prices across all products, and price rises will continue to increase whilst there is shortage of available product.
Toshiba are being pushed to sell to Bain Capital and are still waiting for regulatory approval after it missed it’s 31st March deadline.
President Trump blocked Broadcomm’s proposed takeover of Qualcomm (valued at $117 billion) over security concerns.
Qualcomm and NXP are still waiting for regulatory approval for their merger.
Microchip are set to acquire Microsemi for $8.35 billion.
Copper pricing has fallen slightly and looks to have stabilised with it now being under the $7,000 per tonne which was reported in Q1
Lead-times for offshore PCB’s are now at expected levels following the recent Chinese New Year celebrations.