As 2018 draws to a close, have supply and pricing plummeted? Please refer to "Future Electronics Q4 Market Report"

The hot semiconductor market entered the second half of the year, but encountered China's economic slowdown, the trade war, and signs of fatigue.

So, when the market, which has been rising for more than a year, gradually cools down, everyone can't help but ask:

After all, there is still more than a month left before 2018 comes to an end. Will we be able to wait for a reversal of the ending?

Before entering Fuchang’s Q4 market report, let’s first look at the answers from major authoritative institutions to the current market situation.

In fact, many institutions have predicted and are bearish on semiconductors, believing that a "substantial decline" in the semiconductor industry is inevitable .

Goldman Sachs wrote in an October report that a cyclical correction is approaching and the semiconductor industry will face a downturn. One of the biggest reasons is that monthly semiconductor sales are "well above what we consider to be the long-term trend line." Goldman Sachs believes: "Never before has monthly sales been so much higher than the long-term trend line."

Source: Trend line provided by Goldman Sachs

Morgan Stanley analyst Shawn Kim pointed out that the increasingly negative memory market environment will directly lead to a worsening semiconductor sales market. Some experts even predict that trade tariffs will make the semiconductor industry's profits decline by 25%, making the situation worse.

Basically, the Sino-US trade war, slowing demand for memory chips, rising inventory levels and falling prices are the main reasons why companies expect a cyclical downturn in the industry.

So, how are the supply and pricing performances of these components that were originally in short supply, including memory, in Q4?

Let's first look at the Q3 market and the summary of the authoritative organization. It has to be said that in the past quarter, the growth trend of delivery time has really improved "a little bit".

According to ECIA's trend chart of delivery times for various electronic components (released in September), the trend of the three major sectors competing with each other has not changed significantly.

Source: ecia average delivery statistics

Whether you want to fly higher Discrete devices :

Source: ecia

Or gradually become smoother Three brothers of capacitance and resistance :

Source: ecia

Or the quietly triple jump Power /battery Products :

Source: ecia

From the overall situation, the trend of delivery difficulties remains, but judging from the performance in Q3, delivery times do show signs of stabilization.

Then go to the "Fulltronics Market Report - Q4" report to see the specific fourth quarter product delivery and price trend forecasts.

Comparing Future Electronics' Q3 and Q4 reports, we see:

Discrete device lead times seem to be longer

According to the statistics of "Fuchang Electronics Market Report - 2018Q4": the delivery time of high and low voltage MOSFETs with full production capacity in the second half of the year is still generally high, and the delivery time continues to lengthen, especially the original factory delivery time of high voltage MOSFET generally exceeds 30 weeks.

(Excerpt from: Future Electronics Market Report – Q4)

In addition, in the fourth quarter, the delivery time and price increase situation of discrete device products including Schottky diodes, switching diodes, small signal MOSFETs, Zener diodes, bipolar transistors, digital transistors, general-purpose transistors, etc., has not been significantly alleviated .

(Excerpt from: Future Electronics Market Report – Q4)

(Excerpt from: Future Electronics Market Report – Q4)

In 2018, a mix of price increases, shortages, and new applications has driven discrete device sales growth, while also leading to rising shortages.

According to the latest data from IC Insights, in 2018, shortages of power transistors, diodes and other widely used commodity components are expected to drive the average selling price (ASP) of discrete devices up nearly 8% this year, causing discrete device sales to continue to grow strongly by 12% from the peak of $24.6 billion in 2017 to a record high of $27.6 billion in 2018.

Passive components have improved a bit.

Prices stabilize, but tight delivery schedules are still expected in 2019

Entering the second half of the year, the new production capacity of passive component factories has been exhausted. Although leading manufacturers have proposed plans to invest in new factories, they cannot quickly alleviate the current problems.

Entering Q4, the "Fullchang Electronics Market Report - Q4" report shows that there are some changes in the price trend of MLCC. The price of capacitors above 1UF has a clear upward trend, while the price of capacitors below 1UF has stabilized. The delivery period is generally stable, and the delivery period of products above 1UF is still generally more than 30 weeks .

The supply tension of resistor products has also eased. The delivery time of Panasonic and Yageo products has improved and the prices have remained stable.

(Excerpt from: Future Electronics Market Report – Q4)

Compared with the third quarter, there are differences in the delivery time of some manufacturers such as electrolytic capacitors, tantalum capacitors, and polymer tantalum capacitors. The delivery trend of some manufacturers has improved, while the prices of some products continue to rise.

(Excerpt from: Future Electronics Market Report – Q4)

Judging from the trend, it will take some time for the prices of passive products to fall back to normal levels.

The feast of memory is coming to an end

After two years of rapid growth, the feast of DRAM, NOR flash memory and NAND flash memory chips is winding down.

According to the "Fuchang Electronics Market Report - Q4", the delivery time of various product categories has improved and prices have fallen.

(Excerpt from: Future Electronics Market Report – Q4)

According to the latest survey by DRAMeXchange, a semiconductor research center of TrendForce, the quarterly increase in DRAM contract prices in the third quarter has narrowed to only 1-2%, and may reverse and fall by 5% in the fourth quarter. The possibility of the decline continuing to widen cannot be ruled out, ending the super cycle of nine consecutive quarters of price increases.

DRAMeXchange also believes that after the average price of NAND Flash fell by about 10% in the third quarter, the decline in the fourth quarter is expected to be greater than that in the third quarter due to the impact of Sino-US trade frictions, expanding to about 10~15%. The contract price of mainstream 3D TLC particles in the channel market will even fall by more than 15%.

More...

After the delivery period of power supply products was extended in Q3, the current delivery period is still long, and some prices have been raised :

(Excerpt from: Future Electronics Market Report – Q4)

The delivery time of 32-bit MCU has improved and the price is stable :

(Excerpt from: Future Electronics Market Report – Q4)

Overall, we did see some signs of easing in the supply and pricing of some products before the end of 2018. If you want to know more about the delivery and price trends of products in Q4, you are welcome to download the full version of "Full Electronics Market Report - 2018 Q4" for free.

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"Full Electronics Market Report - 2018Q4"

Important statement: The "Fullchang Electronics Market Report" comes from multiple information sources. The information is for reference only. Please do not change or reprint our information at will. If you need to quote information in the report, please be sure to contact us. Thank you!

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