Value of Electronic Component Production Soars 19% in First Half 2004

The production value of Taiwan's electronic-component production rose 19% in the first half of 2004, to NT$251.4 billion (US$7.35 billion at NT$34.2:US$1), according to the Industrial Technology Information Services (IT IS) office of the Industrial Technology Department (ITD), Ministry of Economic Affairs (MOEA).

Breaking down the statistics, electronics components now encompass just five sectors: chemical semiconductor components, passive components, printed circuit boards (PCBs), connecting components, and energy components.

For the first time this year, production value excludes the integrated circuit (IC) and liquid crystal display (LCD) sectors, both of which have developed into large lines and are expected to top NT$1 trillion (US$29.24 billion) each in annual production value soon. The electronics component figures also exclude some smaller sectors, including diodes, transistors, small motors, and switches.

According to the IT IS data, the first-half production values of the five separate sectors were as follows: chemical semiconductors NT$17.6 billion, up about 15% over the first six months of last year; passive components NT$5.4 billion, up 8%; PCBs NT$18.5 billion, up 21%; connecting components NT$44.3 billion, up 29%; and energy components NT$13.4 billion, up 29%.

The high growth of chemical-semiconductor production, IT IS reports, was due mainly to a more than 20% increase in shipments of white light-emitting diodes (LEDs), stable prices for high-level blue LEDs, and heightened orders for low- and mid-level LEDs. Laser diode shipments also grew by about 20% in the first six months because of increasing orders from big Japanese companies.

IT IS attributed the increased production of passive components to substantial growth in demand for resistors, sensors, and capacitors for consumer-application products. However, the prices of such components dropped during the period.

The strongest growth during the first six months was recorded by multi-layer ceramic capacitors (MLCCs), and makers were able to hike their prices because of the increased demand.

As Japanese manufacturers gradually withdraw from the mid- and low-level radio frequency (RF) component market, IT IS reported, Taiwan's makers of filters and oscillators are rapidly establishing a foothold in the international market, especially in the surface acoustic wave (SAW) filter segment.

PCB makers experienced increased orders for flexible and IC-carrier boards. IT IS expects the demand for flexible PCBs to continue growing in the second half because of strong orders for cell phone and flat panel display products.

Most of the island's connector makers received large orders from big international companies for connectors used in communications and consumer products, racking up a high rate of growth in the first half.

The momentum for growth in the energy-component sector came mainly from makers of cell phones, while demand for use in notebook PCs was relatively weak because that sector is still digesting large inventories built up as a result of excessive optimism about sales during last year's Christmas season. Several local manufacturers of power packs, however, still managed to make impressive gains in the first half thanks to their aggressive advances in the notebook-PC application market.

IT IS predicts that Taiwan's electronic-component industry will generate a production value of NT$547 billion (US$16 billion) for all of 2004, a gain of 17% from last year. Especially high growth is expected for LEDs, laser diodes, flexible PCBs, IC-carrier PCBs, and rechargeable batteries.