ICs
Automotive sector takes another blow
The previously reported country-wide lockdown in Malaysia will not be lifted until daily cases fall below 4,000 and at least 10% of the population is vaccinated. With more than 50 semiconductor plants based in Malaysia forced to operate at 60% capacity, the ongoing chip shortage continues to cause increased lead times and supply gaps. This is expected to affect the automotive industry until at least the end of Q2 2022, as well as the supply for the heightened demand of crystal oscillators, which are primarily produced there.
Vietnam has also extended its lockdown to September 15 due to the COVID-19 outbreak. Samsung and ON Semiconductor are among the manufacturers affected in the region and must limit workforce capacity in order to follow strict government guidelines.
ON Semiconductor MOSFET prices increased
In July, ON Semiconductor’s MOSFET prices increased by 10-20% and some deliveries were pushed to 2022. ON Semiconductor also sent a notice to customers stating its factories in Vietnam and Thailand are being affected by the current surge of COVID-19.
The products affected include ON Semiconductor’s STK6XXX series - Unipolar 2-Phase Stepper Motor Driver (an industrial computing and peripheral application), NCVXXX, NCxxxx LDO regulator and NTDXXX power MOSFETs.
STMicroelectronics packaging plant affected by limited production
STMicroelectronics had production at its Muar, Malaysia plant interrupted temporarily. The products affected are the STM32 MCUs, L62XX motor drivers and the VN series under automotive applications.
TI pricing to continue rising
TI supply remains tight in the open market and price increases are predicted to continue, spotlighting potential issues for TI’s automotive sector. TI has already implemented two price increases in August alone.
The Chinese government announced it would impose strict government control over auto chip distribution and other important commodities in the market due to speculation over price gouging. This is expected to cause further price increases in the future.
NXP prolonged lead times to last until 2022
NXP lead times have continued to stretch and are currently sitting at 52+ weeks. Further, orders scheduled to be delivered between September and November may experience delays due to the company’s assembly plant closure in Malaysia.
Supply will likely remain tight until at least the end of 2021. The ongoing wafer shortage, in addition to increased demand and new lockdowns, are providing no relief for NXP to catch up with demand from automotive customers. Because of this, limited supply will likely continue well into 2022.
NXP also announced a 10% price increase on commodities for all distributors in Q3. Affected series include: MKExxxx, MKLxxxx, MCIMxxx, TJAxxx, industrial application MCUs; MPXxxx pressure sensors, S9S08xxx, MCIMX6xxx, LPC177xxx, LPC24xxx and MCU 32BIT ARM CORTEX.
Passive supply continues to be hit with increasing prices and lead times
The recent lockdowns in Malaysia and the Philippines are impacting major production plants as demand for MLCCs continues to rise.
Because Murata and Samsung have MLCC manufacturing facilities in the Philippines, both have been operating at limited capacities due to government restrictions. In the meantime, Japanese MLCC suppliers are ramping up production in response to the influx of orders sparked by upcoming product releases in Q3 and Q4.
Also hit by lockdowns, Yageo has reportedly raised its production capacities; however, the company still cannot fulfill all its orders.
In other news, chip resistor giant Vishay has implemented price increases from 10% to 20%. Japanese chip resistor leader KOA is expected to follow suit.
Realtek supply to remain constrained
In addition to ongoing raw material shortages, the increased demand for notebooks, automobiles, and Chromebooks has resulted in Realtek’s lead times increasing to 32+ weeks. Realtek is said to supply 70% of audio and LAN chips used in the global notebook market. Alternative sources are not available due to the widespread shortages.
While the supply of Realtek’s IoT and Bluetooth series has slightly improved for orders to be fulfilled, demand for wired networking and wireless communication chips is not being met. It is predicted that this will continue until September 2022.
MEMORY
Memory module activity remains flat
Open market pricing is at least 6% lower than the official price for memory modules, largely due to high inventory levels in the market. Regardless, customers are still showing resistance to new quarter contract pricing. Manufacturers, on the other hand, are pushing to continue price increases.
Server DIMM pricing has already increased around 1-2% across all densities though server DIMM demand remains flat across the board. There are still spots of demand, but this is mostly based on sudden urgent demand. Overall, server DIMM activity remains flat.
PC DIMM demand is predicted to remain soft as more vaccinated employees return to the office, reducing overall demand for laptops and data centers. IC gating issues are also contributing to the sluggish movement of laptop production.
Manufacturers anticipate the contract price of standard memory to drop 5-8% in Q4 due to the high inventory of PC DIMMs. Despite the current market, manufacturers and vendors remain optimistic that an uptick in demand will occur in the next quarter.
STORAGE
SSD price increases expected to continue
In anticipation of growing demand and increased production costs, Samsung has increased its SSD prices once again. This has been met with resistance as customers are not ready to accept the huge jump in pricing.
Demand for Samsung’s SM883 1.92T; however, has not been affected despite open market pricing being 15% higher than official pricing and order lead times stretching from two weeks to four. Further price increments are expected for SSDs in the upcoming weeks due to cryptomining operations migrating out of China and the threat of potential COVID lockdowns.
Pricing for Intel’s higher capacity products, on the other hand, are decreasing, such as its 960GB SSD, which has started to dip by approximately 3-5%.
In other news, there is an insufficient supply of Intel’s SSD 4510/4610 series low-capacity products (mainly the 240GB and 480GB SSDs). Market pricing has increased from about 6% to 10% as a result.
Lastly, a new series of Intel’s S4520 and S4620 SSDs have started hitting the open market, and vendors are anticipating a supply of S4520 to trickle in subsequent weeks. Though faster and more efficient, both new series are expected to be priced similarly to the S4510 and S4610.
HDD market is stable
Overall, there is stable supply and pricing in the HDD market, including for the popular high-capacity 16TB drives. As such, suppliers have sufficient stock to cover previous cryptomining consumption for high-capacity hard drives and factories are equipped with production lines ready to cater to large forecasts if required.
Even so, the supply of low-capacity HDDs may get affected by HDD manufacturers allocating production capacities to high-capacity drives due to higher demand for these products.
GPU market continues to experience high demand and pricing
Generally, GPU demand and pricing remain at high levels.
Due to the low availability of Nvidia’s LHR card and the rapid recovery of mining activities caused by the recent rise in the cryptocurrency prices, demand has been stimulated for Crypto Mining Processors (CMPs); however, these processors are still deemed overpriced by miners and alternative users.
In August, we also saw the official announcement of Intel’s upcoming GPU, called ARC. It is said to launch in early 2022 and should be competing with the likes of Nvidia’s 3000 and AMD’s Radeon series.
Although there are still a lot of unknowns, it is an interesting time to see a new player enter the GPU market.
CPUs
Back-to-school could result in Chromebook CPU shortage
With the development of the COVID-19 pandemic, this year’s return to school plan will dictate demand for Chromebooks. If virtual learning continues to be adopted by elementary schools, there may be another wave of Chromebook demand. Though we have heard that manufacturers have sufficient inventory to satisfy a spike in demand, this has yet to be seen.
What’s more, it is rumored that PC manufacturers are favoring Windows laptop production since it generates a higher profit margin. As a result, Chromebook CPUs will be in shortage if demand for Chromebooks outstrips supply once more.
AMD's Zen 3 Cezanne G-Series desktop processors preferred
Because graphics card prices remain high and supply continues to be limited, the Zen 3 Cezanne G-Series desktop processor continues to be a popular choice and is highly sought after by consumers due to its built-in Radeon Graphics. Unfortunately, AMD is only releasing small pockets of supply, which is certainly not enough to feed overwhelming demand.
Anticipation grows for Intel's 12th Gen Alder Lake
It’s common practice for Intel to push more of its latest products out into the market, i.e. Intel’s 11th Gen i9 and i7 processors. Because the company is focusing on its newer high-end products, the supply of Intel’s i5 series is currently dwindling.
Customers who do require a previous version of Intel’s processors will have to resort to purchasing its 10th Gen Comet Lake desktop CPUs. Still, there will likely be limited allocation supply for the 10th Gen Comet Lake desktop CPUs in the upcoming quarter.
This does not come as a surprise as the highly anticipated 12th Gen Alder Lake is rumored to launch as early as October 2021. If Intel’s 12th Gen Alder Lake’s performance turns out to be as promising as speculated, we could certainly see demand outstrip supply.
As a result, Intel’s 11th Gen Rocket Lake desktop CPUs and 10th Gen Comet Lake desktop supply will likely shrink as Intel prioritizes its 12th Gen Alder Lake CPUs, aiming to recapture previous market share lost to AMD.
Intel announces last product discontinuance for desktop chipsets
Intel announced the last product discontinuance order date for its FH82B460 SRH1C and FH82H410 SRH1D as September 3, 2021, in a push to reduce the adoption rate of its 11th Gen Rocket Lake series. The last product discontinuance shipment date for these products will be December 24, 2021.
Intel also moved FH82H410 SRH1D to the embedded architecture to continue supporting its embedded customers. Regardless, we expect supply to remain limited.
Intel's Ethernet chipset relief may be short-lived
We have heard that Intel has shipped and delivered high volumes of Ethernet chipsets to curb overwhelming demand. Currently, we are seeing improved pockets of supply for Intel’s WGI210AT, WGI210IT, WGI210IS and WGI211AT with fewer premium pricing options available in the open market compared to July 2021.
Having said that, distributors foresee this as a short-lived improvement as supply levels diminish from September 2021, onward because of the low return on investment. Allocation support for Q4 is still uncertain and prolonged shortages are expected until at least Q1 2022.
FINISHED PRODUCTS
Networking card supply hindered by oscillator shortage
Data center users and server integrators are experiencing shortages with network cards. Lead times extended by the oscillator shortage are as long as 8 months, driving the prices of network cards up by 30-40% in the open market. Mellanox’s MCX4 and MCX5 series network interface cards, in particular, remain limited. Notably affected in the 25GB capacity network card space was Intel’s E810 series, which was once monopolized by Mellanox until Intel launched its own product in Q3 2020.
It is a crucial spec for the consumers today; however, Intel is facing lead times of up to 5 months and may stretch even further.
RAID Controller supply is constrained
Broadcom’s 93xx and 94xx series RAID cards remain in high demand while open market prices surge by at least 40-50%. Stock is hard to come by as lead time bookings are reported to be up to 42+ weeks.
Other modules experience price increases
Sierra Wireless Wi-Fi modules have had a 20% price increase since the start of August due to increased production costs from the COVID-19 pandemic.
Also challenged by COVID’s disruptions to the workforce, Sierra Wireless’s Vietnam factory is running at minimum capacity, causing lead times for new orders to extend to 20 weeks.
Meanwhile, components such as wafers and circuit boards used in the production of Intel’s Wi-Fi modules may increase $1-$2 across different series of Wi-Fi modules as a result of the chip shortage.
Mellanox’s Ethernet adapter distributors are sharing that new booking lead times are currently as high as 26 weeks and any incoming stock is being used to fulfill orders placed in the last couple of months. It is possible that there will be a 100-200k allocation of Mellanox’s 512 and 4121 series networking cards in November for these Ethernet adapters; however, distributors are wary of decommitments due to general raw material shortages.
LCDs remain short
LCDs remain short as per previous months. Reduced production caused by continued IC material shortages remains the main contributor.
17’3, 15’6 and 13’3-inch panels are still mainly short, and prices for the 13’3-inch to 17’3-inch are still on the rise. The price of the 11’6 panel, on the other hand, has plateaued.
