MLCC supply is starting to show a tight trend
According to Taiwan media reports on January 6, foreign investment reports indicate that MLCC supply will be tight in the first quarter of 2020, and the price of general-purpose MLCCs may increase by 50% this year.
The report states that a passive component distributor has signed a long-term contract with a Chinese mobile device customer and estimates that this year's performance will increase by 30%. Industry insiders had previously predicted that the tight supply of MLLC would appear in the third quarter, but now it is advanced to the first quarter, showing that 5G smartphones are in high demand.
In addition, Pierre Chen, Chairman of Yageo, previously stated that the stock level of MLCC in the fourth quarter of 2020 dropped below 70 days, and the normal stock level should be 90-120 days. Today, some MLCC suppliers have reached the bottom of their inventory and are actively replenishing to meet customer demand. It is expected that the inventory level will return to about 1.5 months before the Chinese New Year.
Industry insiders pointed out that the tight supply of MLCC was not caused by the market structure, but the manufacturers were cautious about increasing new capacity and were using certain capacity utilization to maintain profitability.
The report further pointed out that due to tight market conditions, some MLCC prices rose within 10%. Most Chinese MLCC manufacturers and distributors believe that general-purpose MLCC prices are expected to increase by 30% to 50% this year.