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AI server promotes MLCC heating up in 2024

Date: 2023-07-10

MLCC shipments decreased from Jan to May, 2023, due to the downturn in the consumer market.
According to statistics, the total shipment of MLCC (multilayer ceramic capacitor) suppliers from January to April this year was 1.359 trillion units, a decrease of 34% compared with the same period in 2021, showing that the impact of global economic problems on the MLCC industry is relatively large big.

Since the second quarter, due to the fluctuating demand for brand and ODM orders, coupled with the constant pressure of price cuts, MLCC suppliers have continued to control production capacity reduction in order to maintain the balance between supply, inventory, and price. In May, the average production capacity utilization rate of Japanese factories was 78%, while that of Chinese factories, Taiwanese factories, and Korean factories was about 60-63%. With the continued sluggish end consumer demand, it may become a short-term normal for suppliers to reduce production and load.

TrendForce further stated that the market generally believed that inventory pressure was the main reason for impacting the MLCC industry. However, from mobile phones, PCs, and notebooks, which accounted for 30% of MLCC demand, ODMs have gradually begun to adjust inventory as early as the third quarter of last year. The quarter has gradually returned to normal, and there are urgent and short-order inventory replenishment situations from time to time. However, the overall situation is still under the pressure of the downturn in the consumer market, so the buyer's pull for MLCC is low and unsustainable. The BB Ratio (order-to-bill ratio) of MLCC suppliers in May was 0.85, only a slight increase of 0.01 from April, and the order growth rate was extremely low.

Looking forward to the third quarter, although brand manufacturers and ODMs still hope that the traditional peak season will stimulate demand recovery, the growth rate of MLCC forecast orders actually released to suppliers is still low, and the performance that the traditional peak season should have has not yet been seen. It is worth mentioning that the Japanese factory Murata has recently received an order from Apple for the preparation of the new iPhone 15 that is expected to be launched in the third quarter. Still attractive.

The passive components industry will rebound in 2024

AI server promotes MLCC heating up
According to Taiwan media reports, some passive component distributors are optimistic about AI servers to promote MLCC recovery in the second half of the year.
Said the deferred demand in the first half of the year is expected to gradually recover in the third quarter.

Due to the stable high-end demand, some companies will focus on high-end fields, and continue to accelerate the operation of AI, high-end applications and automotive markets. they stated at the meeting that the demand for high-end specifications continued to grow in the first half of the year, mainly due to the stimulation of AI artificial intelligence and 5G-related demand, and the overall demand is expected to gradually pick up in the second half of the year.

As for the impact of AI servers on MLCCs, the company said that the current proportion of AI servers is still low, so there is no market research agency to calculate the consumption of AI servers on MLCCs. However, AI servers emphasize high-speed computing, and it is expected to drive MLCCs under high heat For upgrades, such as X5R advanced to X7R series, the unit price and specifications have been increased.

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