Yageo’s chairman, Pierre Chen, recently stated that the supply of MLCC is still in a state of tension, this situation may not be resolved by 2019, but will strive to solve customer demand problems.
Pierre Chen said at a shareholders meeting on June 5th that Japanese and Korean MLCC plants mainly focus on high-capacity, automotive-use products. If the price of high-end passive components is 100 yuan, the price of low-end passive components will be low. Should also be around 60 yuan, but the current price has only 20 to 30 yuan. The outside world believes that Pierre's word suggests there is room for price increase in the production of middle and low-order MLCCs in the future. However, Pierre also believes that price increase is only a short-term phenomenon of supply and demand. The long-term fundamentals still depend on the sales channel and customer structure.
Pierre emphasized that once Japanese and Korean-based giants turn to the high-end product market, they will not go back to mid-to-low-end products. Japanese manufacturers should release 30% of their production capacity; manufacturers in mainland China can only produces low-end products, their technology and quality can not keep up with the Taiwanese factory now, futhermore, the Chinese mainland manufacturers only takes 6% of the global passive component market share, even if they expand production capability by 50% is still very small. Therefore, Pierre consider that the supply of MLCC will be tight until 2019. In addition, the delivery of production equipment lasts from 14 months to 18 months, which is an important reason why Pierre believes that MLCC's supply growth is limited now.
