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Capitalism: Resistors follow NAND, DRAM and MOSFETs
  • Taiwan suppliers have implemented a 100% hike in quotes for some specs of resistors in serious supply shortfall. Nevertheless, local EMS and ODM customers have no other choice but to accept the price rises, as the hiked quotes are still lower than those offered by Japan supplier KOA and they can hardly find cheaper resistors from other sources.

    Jack Chung, president of Chilisin Electronics, a local supplier of chip resistors, said that the supply shortfall will not ease in the short term, and quotes are expected to rise further.

    Taiwan suppliers already raising quotes for their chip resistors reportedly include Ralec Electronic, Yageo, LIZ Electronics, Royal Electronic, Viking Tech and Walsin Technology.

    Industry sources said that chip resistors started to turn tight in the second half of 2017, as customers have since rushed to expand their stockpiles amid anticipations for possible price hikes.

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  • Progress of situation

    The sources said ever-higher prices for MLCC and resistor chips have enabled suppliers including Yageo, Walsin Technology, Holy Stone, Chilisin Electronics and Prosperity Dielectrics to rake in handsome revenues and profits, with Yageo, for instance, posting a whopping annual increase of 99% in April revenues. Some makers have reportedly moved to negotiate with clients on price hikes, instead of announcing fixed increases, with the prices for certain specs even shooting up by 70%.

    Small EMS firms have reportedly failed to get shipments of MLCC and resistor chips from suppliers since the end of Lunar New Year holidays in mid-February 2018, forcing them to purchase the components from spot markets at extremely high prices, so as to avoid production and shipment disruptions.

    Passive components account for only 1-2% of the BOM (bill of materials) at EMS firms, the ever-rising quotes for the components are chipping away almost all of their profits.