Many mature-node (> 65nm) discrete capacity expansions will not come online before 2025, with some ramping as late as 2027. The Commodity IQ Design Index for diodes rose on average by 6% sequentially in Q2 and by 5% year-over-year. Transistors experienced an increase in design activities of 7% in Q2. For Q4 2022, the quarterly index growth for diodes and transistors was 9% and 11%, respectively. Teams should plan for constrained supply as demand returns.

The pending August suspension of tin mining in Myanmar will pressure global supply, and propel prices higher in the short to medium term. Myanmar is the third-largest tin concentrate miner, accounting for about 10% of the global supply. Shanghai Metals Market refined tin pricing for July 6 was up over 10% versus June 6. In the same timeframe, lead-based solder bar and lead-free solder pricing rose by 11% per metric ton. Combined with Indonesia's potential export ban of refined tin, a buy-as-needed strategy is necessary until trends become more solidified.

AI model training and deployment can easily require thousands of GPUs, fueling the need for power supply units (PSUs) that in turn require two or more times the number of ICs and passives. Power supply makers and EMS providers indicate that PSU demand has increased. Currently, power MOSFETs are of chief concern. The Commodity IQ Lead Time Index for power MOSFETs in June was over two times the baseline and the At-Volume Lead Time Trend for transistors in Q3 points to 45% of MPNs with lead times of 36 weeks or more. Long-term agreements are strongly encouraged for new product introductions that feature MOSFET. Alternate manufacturer qualification, extended order bookings, and sharing 52-week-plus forecasts with suppliers are also advised.

The prospect of increasing demand for artificial intelligence (AI) inference servers, robust automotive and factory automation markets, expanding use cases for edge processing, and with FPGAs as key data center components – the programmable logic market is poised to prosper. Supplyframe projects the AI cloud and enterprise data center market alone for FPGAs could drive 50% year-on-year growth in 2024.  

The reason for concern is that IGBTs are in high demand for motors (there were large orders by BYD and Tesla in February) and also energy applications. On top of that, design seasonality creates periodic peaks in demand, and added capacity is not coming online until 2025. Supplyframe predicts IGBT inventory will be below pre-covid levels by July. Place your PO's soon.

Display driver pricing has skyrocketed 22% year-over-year, and will continue climbing in the near future. This correlates to a 18% month-over-month increase in design activity on the Supplyframe network, largely related to demand for drivers for multiple displays that go into automotive applications. Reason for increases include industry consolidation (reduced competition), amortization of R&D into component pricing, and an overall decline in inventory.

Pick a color, any color... except maybe green. Among all LEDs in photonic devices, green is the most popular. Perhaps when it comes to selecting light-emitting diodes, electrical engineers and commodity managers are most likely to pick the color of money. Keep this in mind for your next sourcing event --there could be assurance of supply issues in the future.

Smartphone sales were down 15% year-over-year in the first quarter of 2023. As a result, design-ins of MCUs are 10% lower year-over-year, based on activity across the Supplyframe network. This correlates to drops in consumer demand, and is a pattern we'll likely see continue into the future. Manufacturers can view this as an opportunity to reduce cost for MCUs. Particularly those sourced from Chinese and Taiwanese MCU suppliers--after recently increasing capacity, they may be more competitive on price.