IHS iSuppli: Expect Component Shortages, Price Hikes



IHS iSuppli is reporting the catastrophe in Japan could result in significant shortages of certain electronic components, potentially causing pricing for these devices to increase dramatically.

The research firm said there are few reports so far of actual damage to CE production facilities in Japan, but the impacts on the transportation and power infrastructure will result in disruptions of supply.

Among the components expected to be in short supply and have higher prices will include NAND flash memory, dynamic random access memory (DRAM), microcontrollers, standard logic, LCD panels, and LCD parts and materials, IHS iSuppli said.

Japan also is the world’s largest supplier of silicon used to make semiconductor chips — at about 60 percent of the global total, the research firm said. If this supply is disrupted due to the logistical and infrastructure challenges Japan is facing, this will have an impact not only on NAND flash memory, DRAM, microcontrollers, standard logic, LCD panels and LCD parts, it will also affect other families of products such as discretes, i.e. MOSFETs, bipolar transistors and small signal transistors.

Infrastructure challenges will slow or suspend shipments from Japan during the next two weeks, the firm said. However, the global supply chain has about two weeks of excess component inventory in the pipeline for semiconductor parts affected by the quake. Because of this, the shortages are not likely to appear until the end of March or the start of April. Just the same, these shortages and their price impact are likely to linger until the third quarter.

Before the disaster, semiconductor inventories in the global semiconductor supply chain were at high levels, IHS iSuppli said.

Pricing for higher-density NAND flash already has climbed by as much as 10 percent on the spot market, which buyers use to procure relatively small quantities of parts. However, IHS does not expect price volatility for OEM DRAM customers, and it is likely that the average selling price for major OEM customers on the contract market will hold steady for sustained periods of time until the supply chain moves past the infrastructure challenges.

Spot-market DRAM pricing also is surging, rising by as much as 7 percent since March 11, but contract pricing is holding steady.


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