MLCC prices rebound for first time in three years

Taipei, Oct. 16, 2003 (CENS)--The prices of multi-layer ceramic capacitor (MLCC) products are expected to rise after lingering at low levels in the past three years, according to industry sources.

With the peak season for electronic components in the fourth quarter, the production capacity utilization rates of many major makers of MLCCs and chip resistors in Taiwan have reached about 90% while the prices of their products are rising due to strong demand.

A senior official of Holy Stone Enterprise Co., Ltd., a major MLCC maker in Taiwan, said that his company raised the prices of many MLCC products, including the 0402 and 0603 models etc., by 5% earlier this month. The official said that was the first price rebound for such passive component in the past three years.

The Holy Stone official attributed the price hike to the strong demand from makers of notebook PCs, digital cameras, cell phones and liquid crystal display (LCD) TVs, whose products are enjoying hot sales in the global market. The official added that his company's capacity utilization rate has jumped to about 90%, but the firm is still facing excessive demand. Holy Stone predicted that the favorable business climate in the MLCC market would last at least to the end of the year.

Yageo Corp., the No. 1 MLCC supplier in Taiwan, is also facing an excessive demand. According to a senior Yageo official, strong market demand started to come several months ago and is expected to continue for a certain period of time. In the past few months, the official reported, the company started to experience tight supply of 0402 high-capacity MLCC products but now the supply tension has extended to all of the company's such products including 0603, 0805 and chip resistors. Yageo claimed that its capacity utilization rate also surpassed 90% last month.

The Yageo official claimed, however, that his company would try as hard as possible to stabilize prices as most of the company's customers are long-term partners. At least, he added, the price-falling trend of passive components in the past three years has gained clear improvement.

Walsin Technology Corp., another leading MLCC supplier, confirmed that it is facing a supply tension for some high-capacity MLCC products such as the 0402, especially with customers in the industry clusters in mainland China and the Asia-Pacific.

Walsin estimated that the demand will become even stronger in the fourth quarter and greatly ease the falling pressure on prices of MLCC products and help boost the prices slightly.

Some local agents of high-end passive components imported from Japan, faced a supply tension of MLCC products earlier than local makers. According to Nichidenbo Corp., the local dealer of passive components made by Nippon Chemi-con and Panasonic, said that its Japanese suppliers are intensively assessing the possibility to raise their product prices in the fourth quarter by 3% to 5%.