Market volatility intensified in the first quarter due to the onset of "M&A sequelae" and "exchange rate fluctuations".

Although the price of electronic materials can be seen going up and down every quarter, and the delivery time can be long or short, but according to Future Electronics, "exchange rate fluctuations" and "merger sequelae" are double challenges for electronic component procurement in the first quarter of 2016.

Since the exchange rate reform, the RMB exchange rate against the US dollar has been falling. So we have seen that the price of imported cars has increased, the price of cosmetics purchased on behalf of others has increased, and even the price of Apple's APP applications has increased by up to 22% in many countries. Of course, perhaps ordinary people will not feel that the pressure on electronic materials is greater, because the proportion of import dependence is high, and the import prices of CPU, memory, hard disk, and SSD have risen one after another. The quotations of many basic components have also increased because they cannot withstand the rhythm of the exchange rate jump. This may be an inevitable round of price increases.

Image source: Eastmoney.com

Another factor that must be paid attention to in the first quarter is that the impact of "M&A sequelae" has begun to emerge. In 2015, we experienced a wave of mergers and acquisitions. The integration of industry leaders was like dominoes, breaking the market structure and reshuffling it. In the process of mergers, various homogeneous products were either discontinued, or adjusted in price, or adjusted in product lines, which more or less brought unstable factors to electronic material purchasers. At present, it seems that prices and delivery times have fluctuated to a certain extent. For example, a certain brand of electronic materials announced that it would stop production after the merger. Basically, what was sold on the market was inventory, out of stock, and the market price was inflated. Some product lines were also re-priced after being acquired, and prices were also raised to a certain extent, and delivery times were extended.

Image source: Network compilation

Of course, any unstable factors in the electronic component supply market may have an adverse impact on upstream manufacturing. Relying on the industry's largest "saleable" inventory advantage, Future Electronics has always been committed to the "Delight the Customer" principle, hoping to provide customers with a stable supply chain, competitive costs and efficiency, and strive to maintain a stable market. In the latest market report for the first quarter of 2016 released by Future Electronics, we can see that the prices and delivery dates of most electronic components are basically stable, and there are cases of extended delivery dates and price increases on some product lines.

From the list of categories, we can see that after acquiring MEAS, TE (TES) reviewed and readjusted the prices of sensors, resulting in increased costs. Several product lines of Fairchild Semiconductor also saw increases compared to the previous quarter, including general-purpose transistors, low-voltage Mosfet, and high-voltage Mosfet. NXP's 8-bit MCU prices increased and delivery times were extended. Macronix and Microchip's NOR flash prices increased, etc.

Image source: Future Electronics 2016 Q1 market report, some price and delivery trends.

Image source: Future Electronics 2016 Q1 market report, some price and delivery trends.

If you want to know more about the price changes of electronic components, please click on the following categories to browse the full report. The information in this report comes from multiple sources and is for reference only. You can also contact the account manager of Future Electronics for consultation and discussion. Future Electronics provides world-class supply chain solutions to alleviate market supply and demand fluctuations.