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In an update to the fallout from the Japanese earthquake and tsunami, IHS iSuppli reports that many OEMs are now engaging in "panic buying" for Japanese electronic components, causing erratic price spikes of 10-25 percent since the March 11 devastation.
Specifically, OEMs are seeking to secure supplies of semiconductors and printed circuit boards. Mitsubishi Gas Chemical Company and Hitachi Kasei Polymer Co. have both announced a two week shutdown of copper-clad laminate (CCL) production – a key raw material used in printed circuit boards. Together, these two companies account for 70 percent of the global CCL supply. Estimates predict OEMs will likely be able to continue production of electronic goods using existing surplus inventories, however if the plants remain shut down for longer than two weeks, many will be forced to idle capacity. Component distributors report a major bump in parts orders from OEMs looking to cushion their supplies.
Semiconductor manufacturing is also under threat. The 53 semiconductor manufacturing facilities in Japan – even ones undamaged by the quake – automatically shut down when a magnitude 5.0 earthquake is detected. Repeated aftershocks ranging from 4.0 to 7.0 on the Richter scale have forced many to suspend operations until the tremors subside.
Additionally, 25 percent of global production of silicon wafers (the primary component of advanced semiconductors) has been suspended. Facilities operated by Shin-Etsu Chemical Co. and MEMC Electronic Materials Inc. account for a quarter of world silicon wafer supply. Shin-Etsu's facility is located near the beleaguered Fukushima nuclear plant which has prompted worker safety concerns, and the facility itself suffered damage to its equipment and power system. Company management is working to increase manufacturing capabilities at other facilities in the country, but no timeline was available.
Some chip makers have partially resumed operations, however. Fujitsu, Renesas Electronics and Toshiba have all announced some of their facilities in hard-hit Northern Japan have come back online. The companies also said that they were still assessing the full extent of the damage and that rolling blackouts were still hindering operations even at undamaged sites. Are you looking for specialty parts? we have many long-life electronics available on our webstore.
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