Japan is the largest supplier of silicon and accounts for about 60% of global supply. If Japan's logistics and infrastructure issues cause disruptions in silicon supply, it will not only affect NAND flash, DRAM, microcontrollers, standard logic, LCD panels, and LCD components, but will also affect products such as discrete devices such as MOSFETs, bipolar transistors, and small devices. Signal transistor.
Destruction of infrastructure will lead to slowing or interruption of shipments in Japan. However, for the electronic components affected by the Japan earthquake, the global supply chain has about two weeks of excess inventory. Therefore, it is expected that there will be no supply shortage before the beginning of April, but the shortage and its impact on prices may continue into the third quarter.
Although no shortage actually occurred, the price of components has been affected due to the psychological impact caused by natural disasters. The price of high-density NAND flash memory has risen by about 10% in the spot market, and buyers usually have relatively small purchases in the spot market. However, IHS expects that OEM DRAM customers will not face price fluctuations. And in the contract market, the average price of major OEM customers will remain stable until the supply chain withstands the test of infrastructure problems.
The price of spot DRAM is also rising and has risen by 7% recently. The current contract price is stable, but with the renegotiation of the contract, the price may rise moderately.
Most of Japanâ€™s large electronic component manufacturersâ€™ factories are located far south of the epicenter and away from the most severe tsunami areas. Therefore, the damage suffered is very small. However, these manufacturers face problems such as transporting components, receiving raw materials, and transporting workers to work. Power outages also affect production, and the impact can be significantâ€”depending on the type of product being produced.
In addition, a Hitachi display factory is closest to the earthquake area. The Hitachi plant stopped production on Monday to assess the impact of the earthquake. Even if the structure of the factory is not damaged, its production operations may also be affected by power interruptions. Hitachi's display supplies Nintendo DS handheld game consoles and LG mobile phones. If the plant is discontinued for a month or more, shipments of these products may be affected.
Panasonic's sixth-generation LCD factory in Japan produces LCD TV panels for Panasonic and Chinese brands. As the plant is close to the area surrounding the earthquake, its production may be temporarily affected. Preliminary information shows that most of the devices used in large LCDs, such as glass, color filters, and polarizers, have not been affected in Japan. However, power supply issues may affect the future production and supply of these LCD devices. If production continues to be disrupted, it may affect supply and cause prices to rise.
Devices used to produce LCD panels have signs of supply disruption. Fujifilm's production of color polarizers is affected and may affect the price of this critical device.
The impact on semiconductor production in Japan does not manifest itself in the direct destruction of production facilities, but in the supply chain. The difficulties that suppliers may encounter are the inability to receive raw materials and the shipment of products. According to a preliminary assessment by IHS iSuppli, this may interfere with Japanâ€™s semiconductor supply in the next two weeks.
In 2010, the output value of large-size LCD panels in the world was USD 86.3 billion, and Japan accounted for 6.2%. A large-size LCD panel refers to a panel having a diagonal size equal to or greater than 10 inches. Japan accounts for 14% of LCD TV panel production. Many high-generation LCD factories are located in Japan, including the only one of the world's 10th-generation LCD factories, operated by Sharp. A preliminary study released by the Japanese display research team of IHS iSuppli Company believes that because of its remote location, the Sharp plant has not been directly hit by the earthquake. Only one large LCD factory may be located in the surrounding area affected by the earthquake.
The impact on the production of LCD panel parts in Japan may be even more important. Among the devices used in LCD panels and LCD-based products, Japan's production accounted for a large proportion, including glass, color filters, polarizers, CCFLs, and LEDs.
The Japanese earthquake and tsunami could cause severe shortages of seven kinds of electronic components, including NAND flash memory, DRAM, microcontrollers, standard logic, liquid crystal display (LCD) panels, LCD components, and materials, which in turn drove the price of these components to rise significantly.