Yageo Corp (國巨), the nation’s biggest passive component supplier, yesterday said that customer demand is still two times as large as its shipments, indicating that persistent supply constraints would carry over into the mid-term.
The company is bullish on demand for multilayer ceramic capacitors (MLCC) due to an increase of applications in electronic devices and new orders from customers of Yageo’s Japanese rival Murata Manufacturing Co, it said.
Murata has announced it would pull out of certain traditional MLCC markets and focus on high-end MLCCs for electric vehicles, Yageo said.
The Japanese company plans to stop taking orders for traditional MLCCs from March next year and stop production of such products by spring 2020, Yageo said, citing information received from customers.
Murata’s exit would increase demand for components by other manufacturers by 20 percent and would further squeeze already tight supply, the company said.
“Yageo is capable of supplying 95 percent of the items [originally supplied by Murata], including high-capacity MLCCs… There are no technological barriers for us,” Yageo chairman Pierre Chen (陳泰銘) told investors in a teleconference call yesterday.
The additional orders would not necessarily be for low-end products and Chinese manufacturers would face technological barriers to supplying such components, Yageo said.
As a result, the company expects the supply crunch to continue into the near and medium term, supporting MLCC prices at a reasonable level, Chen said.
MLCC prices are only just bouncing back to what they were seven years ago, he added.
There are no signs that supply will ease, as customers have requested emergency shipments to avoid production disruptions, Chen said.
“As of last week, the company’s book-to-bill ratio still stands at 3, meaning that orders are twice as high as our shipments,” Chen said. “Most customers have seen their inventory fall to a very low level.”
To better meet demand ahead of the peak season next quarter, Yageo aims to boost its inventory to 45 days of shipments, from 35 days last quarter, the company said, adding that that would still be far below a healthy inventory of 60 days.
The supply constraint is caused by supply shortage of chip resistors due to stricter environmental requirements in China, the main manufacturer, Chen said.
Regulatory tightening has disrupted production of chip resistors and key components, he said.
Yageo is the largest chip resistor maker in the world.
Higher wages and component costs have also prevented chip resistor and component suppliers from expanding capacity, Yageo said.
The company’s shares surged 2.54 percent to a record high of NT$1,210 yesterday on the forecast supply constraints.
The Eurovision Song Contest has seen a surge in punter interest at the bookmakers, becoming a major betting event, experts said ahead of last night’s giant glamfest in Basel. “Eurovision has quietly become one of the biggest betting events of the year,” said Tomi Huttunen, senior manager of the Online Computer Finland (OCS) betting and casino platform. Betting sites have long been used to gauge which way voters might be leaning ahead of the world’s biggest televised live music event. However, bookmakers highlight a huge increase in engagement in recent years — and this year in particular. “We’ve already passed 2023’s total activity and
Nvidia Corp CEO Jensen Huang (黃仁勳) today announced that his company has selected "Beitou Shilin" in Taipei for its new Taiwan office, called Nvidia Constellation, putting an end to months of speculation. Industry sources have said that the tech giant has been eyeing the Beitou Shilin Science Park as the site of its new overseas headquarters, and speculated that the new headquarters would be built on two plots of land designated as "T17" and "T18," which span 3.89 hectares in the park. "I think it's time for us to reveal one of the largest products we've ever built," Huang said near the
China yesterday announced anti-dumping duties as high as 74.9 percent on imports of polyoxymethylene (POM) copolymers, a type of engineering plastic, from Taiwan, the US, the EU and Japan. The Chinese Ministry of Commerce’s findings conclude a probe launched in May last year, shortly after the US sharply increased tariffs on Chinese electric vehicles, computer chips and other imports. POM copolymers can partially replace metals such as copper and zinc, and have various applications, including in auto parts, electronics and medical equipment, the Chinese ministry has said. In January, it said initial investigations had determined that dumping was taking place, and implemented preliminary
Intel Corp yesterday reinforced its determination to strengthen its partnerships with Taiwan’s ecosystem partners including original-electronic-manufacturing (OEM) companies such as Hon Hai Precision Industry Co (鴻海精密) and chipmaker United Microelectronics Corp (UMC, 聯電). “Tonight marks a new beginning. We renew our new partnership with Taiwan ecosystem,” Intel new chief executive officer Tan Lip-bu (陳立武) said at a dinner with representatives from the company’s local partners, celebrating the 40th anniversary of the US chip giant’s presence in Taiwan. Tan took the reins at Intel six weeks ago aiming to reform the chipmaker and revive its past glory. This is the first time Tan
RSS