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The Industry News and Analysis You Need to Know
Memory Price Index Hits Four-and-a-Half Year High
The Commodity IQ Price Index for memory surged again in May, as booming demand and constrained supply of artificial intelligence (AI) memory chips boosted the reading to a four-and-a-half-year high
AI-Enabled PC and Server Builds Will Put Upward Price Pressure on MLCCs
High-capacitance ceramic capacitors will see ASPs inflate as AI-enabled laptops and servers are based on entering mass production in H2. MLCCs represent more than two-thirds of the total part count on servers. For capacitors overall, the Commodity IQ Inventory Index for the first six months of the year was 44% lower on average than the prior six-month period, and the price index rose 15% by the same measures. The Commodity IQ Price Index for June reached its highest value since Q4 of 2019.
The Ups and Downs of Resistors
Global resistor demand in 2024 was off by 4% year-on-year through the first six months, yet it rose by nearly 5% compared to the previous six months. The Commodity IQ Price Index for resistors inflated by 11% in June compared to the January reading but remains less than half of the pre-pandemic levels in 2019.
Global Design and Sourcing Activity to Fall in Q3
The Commodity IQ Design Index and the Commodity IQ Demand Index are forecast to decline quarter-over-quarter through Q3 by 5% and 8%, respectively. While decreases in the sourcing activities indicate falling demand, nearly 80% of electronic component commodities are projected to ebb by less than 5%, and over 40% will remain above the index baseline, signifying growth but at a slower rate. The component design picture in Q3 will show a different landscape, with 65% of commodities weakening by 5% or more. There may yet be some opportunities for cost-downs.
Demand Is Down But Not Everywhere
While all regions experienced less sourcing action in June, some countries fared better than others in the last six months as measured by their compounded monthly growth rate (CMGR) over the same period, including increases of 3% in the United States, 4 in Germany, and 7% in Singapore. In these countries over the same period, demand expanded for both interconnects and passives by 5%, optoelectronics by 3%, and circuit protection devices by 4%. No electronic component commodities in any region (Americas, APAC, and EMEA) had a declining CMGR for the past six months of more than 3%.
As Inventory Indigestion Abates, Buyer Heartburn Rises
During the past two years, the enormous buildup of excess inventory has been prevalent in the electronics component market. However, the latest signs from the Commodity IQ Inventory Index and the marketplace reveal that the inventory dragon may have been unequivocally slain
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