DRAM spot market prices stabilized in late July as Samsung’s aggressive pricing for server DRAM and enterprise SSDs helped maintain market equilibrium. DDR5 is experiencing larger price hikes than currently over-inventoried DDR4, and contract DRAM pricing is expected to increase by an average of 10% in Q3 for server and PC variants. Micron increased LPDDR5 pricing by 15% at the start of calendar Q3 on stronger shipment projections for notebook and mobile electronics. Supply chain and procurement professionals are advised to seek and secure advantages from short-term spot market pricing opportunities and oversupply situations. 

Though global copper reserves will currently meet demand, consumption continues to outpace supply. According to the International Copper Study Group (ICSG), the projected surplus of copper for 2024 will contract by 65%. Pricing, while bearish, has retreated from over $10,000 per metric ton in May on fears of short supply and as Chinese smelters cut production. Yet, on average, copper pricing was 13% year-on-year in July, prompting some connector manufacturers to pass cost increases to customers to preserve margins.

According to in-market feedback, the recent demand uptick for power management ICs (PMICs) has prevented key supplier Monolithic Power Systems from meeting customer demand. The Commodity IQ Demand Index for power ICs rose 6.8% sequentially in July. Regarding power management ICs, lead times remain at over one and half times the Commodity IQ Lead Time Index globally, while supply-side inventories sank by over 30% month-on-month in July. Lead times for general-purpose and automotive-grade PMICs are in the 20-plus week range.

After shrinking by nearly 16% in 2023, the global PCB market is set to rebound to 6.3% growth in 2024, according to the Taiwan Industrial Technology Research Institute (ITRI). PCB lead times remain consistent, typically at 5 to 8 weeks, with some suppliers quoting an additional one to two weeks due to longer raw material lead times. China-based PCB suppliers are operating at nearly 75% production capacity, up from Q2. Lead times for copper-cladded laminate (CCL) have expanded, with standard FR-4 materials experiencing a two-week increase and special materials like high-speed and high-frequency at four weeks. Overall, the Commodity IQ At-Volume Lead Trend shows almost all Q3 contract lead times remain at 12 weeks or less. 

In another sign of renewed strength in the electronic components market, the Supplyframe Commodity IQ Demand Index rose by 8% sequentially in July, ending three months of decline. However, the overall index remained nearly 20 points below the 2020 baseline, indicating that sales have not yet recovered to the robust levels seen four years ago.

Micron's high-bandwidth memory has been sold out throughout the year and into 2025 due to the constraints of the key technology for AI server demand. With its focus on HBM capacity increases and DDR5, data center customers employing DDR4 will continue to see price increases, as will industrial, automotive, and mobile device OEMs that depend on Micron for more mature DRAM products. 

Expanding logistics costs, particularly freight rates, are leading component manufacturers and distributors to raise part pricing and, in some cases, additional service fees. For example, Avnet added service fees for new shipments in June. The Drewry World Container Index has more than doubled since January, rising just over $3,000 per 40-foot equivalent (FEU) container. Drewry indicates that just one of the eight key East-West trade routes has experienced an annual spot pricing decline; the average annual increase was over 140% across all eight.

Although the increase in inductor input costs has waned, raw materials remain markedly higher than pre-pandemic levels, and the exchange rate between the U.S. dollar and the Japanese yen is impacting imported materials and operational costs. Despite the rise in competition from China, the Commodity IQ Price Index across all inductor types was up 4% in July compared to January and almost double year-on-year for July.

Lead times for diodes and transistors have normalized, and some auto-grade power MOSFETs are oversupplied. For diodes year-on-year in July, the Commodity IQ Lead Time Index was down 8.2%, and power MOSFETs of all grades were down by over 40%.