Market Insights - Q4 2023 - New Design - Flipbook - Page 8
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General Market Insight
Passive Commodities
Ceramic Capacitors
" Supply - Manufacturers experience a slight increase in utilization rates to around 60%, driven by product mix
shifts; AI application orders rise, but automotive backlogs decline with varying capacities; commercial-grade
MLCCs are abundant, while specialized automotive MLCCs face supply chain challenges; suppliers maintain low
inventory due to uncertain OEM/customer expectations, leading to gradual declines in distribution-stage
inventory levels, and overall lead times stabilize.
" Market Dynamics - Suppliers, aligning with the China+1 strategy, are expanding production capacity in various
countries, emphasizing high-voltage and reliable products; the electric vehicle market maintains robust growth,
with OEMs adjusting inventory levels; upcoming smartphone launches do not seem to disrupt supplier supply
chains; intentional alignment of technical requirements and supplier selection is crucial for a sustainable and
reliable supply chain amid diverse strategies pursued by suppliers.
" Price - Prices are increasing, particularly for niche products containing palladium; manufacturers adopt
competitive pricing strategies to maintain factory utilization and strive for market share through high-volume
sales.
Tantalum Capacitors
" Supply - Tantalum MnO2 experiences a significant demand decline across all case sizes, with 50-60% average
capacity utilization, weak demand for large case sizes in industrial, automotive, and renewable energy sectors,
reduced lead times at 14-16 weeks; 12-week lead times for small case sizes with suppliers ready to shorten or
meet increased demand within 8 weeks; Tantalum polymer products show reduced lead times from 26 to 12-16
weeks, and healthier Commodity BB ratios at 0.6:1 for MnO2 and 0.7:1 for polymers, prompting suppliers to
enhance flexibility to support rising demand.
" Market Dynamics - Legacy MnO2 capacitors face no further investment due to market demand and
technological advances, with manufacturers shifting resources to expand tantalum polymer capacitor
production, responding to increased market demand for its superior performance; AVX, Vishay, and Kemet take
strategic steps to meet demand, including building new facilities and expanding production for tantalum
polymer capacitors.
" Price - Tantalum MnO2 cost challenges persist amid a shift away from the product, compounded by high raw
material costs, while stable prices are anticipated through 2023; legacy products like wet tantalum and military
series are expected to see price increases due to production scale limitations, resulting in higher production
costs.
Magnetics
" Supply - Suppliers experience decreasing finished goods inventories amid low customer demand, with an
average capacity utilization rate around 70%; increased production capacity and improved lead times for raw
material supply contribute to inventory decline; while some suppliers still face shortages of specialty automotive
parts, the overall number is decreasing; lead times for multilayer chip inductors have consistently improved and
are now estimated at 8 to 12 weeks, although TDK's MLF/MLZ1005/1608/2012 series has seen a significant
reduction to 32 weeks. Lead time for common mode chokes is 10-14 weeks
" Market Dynamics - Pulse Electronics is actively integrating its brands, including Chilisin, Mag Layers, Magic, and
Bothand; there is a noticeable production capacity expansion trend in Southeast Asian countries such as
Vietnam, Thailand, Malaysia, and the Philippines, driven by ongoing trade tensions between the US and China;
sustained cost increases in southern China lead to significant growth in start-ups and expansion of existing
facilities in western and central China, attributed to rising personnel and equipment costs.
" Price - Stable prices amid the market downturn, as suppliers address reduced demand and logistical issues by
focusing on depleting high inventory levels at original cost for custom inductors and transformers.
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