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.
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Last week we looked at price drops in Chinese cobalt sulfate. Now we're seeing a similar pattern in batteries. Pricing for LCO batteries is down 12% in the last month. Among the reasons for this are the decline of cobalt substrate pricing, partnerships among Chinese suppliers like Catl and Arun, and the auto industry's ongoing movie to sodium and solid state batteries reducing demand. |
Supplyframe Commodity IQ endorses the view that the U.S. economy will enter a moderate recession in the second half of 2023, while China will attain respectable growth. However, market events and seasonal factors indicate that electronics demand will recover during the last six months of the year. For electronics buyers who have seen refreshingly favorable pricing and lead-time trends in the first half of 2023, the shift in market conditions is projected to change the purchasing environment.
Channel inventories surged by 54% in Q1 2023 versus Q1 2022, improving sensor availability and lead times. However demand is projected to bounce back in Q1 2024 and Chinese suppliers are starting to increase pricing, especially for legacy products. We recommend buyers multi-source devices.
DRAM pricing is starting to bottom out and will increase starting in Q3 as previous capacity reductions are implemented. With demand strong and supply tight for DDR5 & NOR, DRAM average selling prices will climb by single-digit percentages in Q4. Expect a more marked increase in H1 2024.
Pricing was off by 15% year-on-year in Q1 as suppliers became more aggressive to maintain or gain market share. Potential cost reductions are more prevalent on smaller-sized crystals and most tier-one and two manufacturers have or will end-of-life larger package sizes. Now is a good time to quote and recognize some reductions.
Despite magnetics (filters, inductors, and transformers) inventories increasing by an average of 6% from Q4 2022 through Q1, and transformer inventory jumping 14% from April to May – suppliers are holding their price points.