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Jabil's Global Commodity Intelligence Archive
Q1 2022
Jabil's Global Commodity Intelligence Archive
Q1 2022
INTERCONNECT COMMODITIES
CONNECTORS
- Most of the suppliers’ factories are running at close to full capacity and there are still certain factories that are further constrained due to continuing COVID outbreaks. There is still backlog that needs to be cleared and thus we are not seeing much flexibility to support urgent upsides and pull-ins.
- Raw material (copper alloy, and resins) shortages continue to be a challenge and we are expecting this to continue through the 1H’22. Adding to the challenge is the current freight & logistics constraints that has caused shipments to take longer than usual.
- Key supplier’s book-to-bill ratios remain high and range from 1.1-1.3:1. We have seen lead times stretching by another 2-4 weeks because of the overall demand and associated constraints.
- Supply base remains stable with no tell-tale sign of any suppliers exiting the market.
- September 8, 2021: TE Connectivity (TE) & Laird Connectivity, a leading provider of wireless modules, IoT devices, and antennas, are pleased to announce that TE signed a definitive agreement to acquire the antennas business from Laird Connectivity. The acquisition of the Laird antennas business complements TE’s broad connectivity product portfolio, particularly in antenna and wireless solutions for Internet of Things (IoT) devices and Edge Access. The acquisition also expands TE’s engineering and manufacturing footprint and strengthens TE’s presence in several attractive market segments.
- Lead times continue to stretch for the US manufacturers, meanwhile the balance of the supply base (Taiwan, Japan and Korea) have maintained their previously quoted lead times.
- The majority of suppliers have quoted their factory utilization at > 95%.
- Suppliers continue to see increased orders from the Automotive, PC & Server markets.
- China-based cell phone manufacturers have forecasted a slow down but expect to pick up again in Q2’22.
- Unforeseen disruption caused by the COVID-19 outbreak continues to impact production cycles, transportation, logistics and causing factory closures in extreme cases.
- Order backlogs are at an average of 3-4 months. EU and NA orders remain strong, but suppliers have mentioned a slight weakening from the Chinese market.
GOLD, COPPER & PALLADIUM PRICE TRENDS
RELAY
Increasing demand during the holiday season adds to the challenge
- Suppliers continue to see strong bookings / demand and therefore an accumulating backlog.
- Capacity at suppliers’ factories ( TE, Omron, Panasonic) are fully booked through 1H’22.
- The China Power Crunch is still having an impact on certain suppliers located in JiangSu, ZheJiang and the GuangDong area. Even as the Power restrictions ease, we expect the Chinese New Year holiday will interrupt the supply of power for approximately 2 weeks.
- Overall, lead times stay flat when compared to last quarter.
- The supply base remains stable with no tell-tale signs of any suppliers exiting the market.
- Costs continuing to rise as suppliers contend with raw material prices increasing, material shortages, and increasing logistics costs.
- The price of copper has increased approximately 50% year on year, tin increases 70% in the same time period.
- Most of the Chinese suppliers are receiving notification that electricity pricing will increase by up to 20% and this will affect product pricing soon.
SWITCH
Increasing demand during the holiday season adds to the challenge.
- Most suppliers’ capacity is fully booked through Q1’22.
- Overall, lead times have remained flat when compared to last quarter.
- The on-going COVID pandemic, raw materials issues and labor shortages due to the Chinese New Year celebrations will be a challenge in Q1’22.
- Extended logistics backlogs due to the holiday season will be another factor potentially impacting delivery.
- The supply base remains stable with no tell-tale signs of any suppliers exiting the market.
- Costs continuing to rise as suppliers contend with raw material prices increasing, material shortages, and increasing logistics costs.
- The price of copper has increased approximately 50% year on year, tin increases 70% in the same time period.
- Most of the Chinese suppliers are receiving notification that electricity pricing will increase by up to 20% and this will affect product pricing soon.
BATTERY
Capacity constraints, supply allocation.
- The battery market remains strong due to automotive, power tools, medical and retail and printer demand picking up.
- Extended logistics timing and raw material availability remains a concern.
- Panasonic BR Battery is still on allocation. • CR coin battery supply is stable with lead times quoted at 14-28 weeks.
- The supply base remains stable with no tell-tale signs of any suppliers exiting the market.
- EVE invested 30Bn RMB in JingMen, Hubei province to establish a new factory for 4680 battery cells.
- Power Glory plans to increase their coin battery capacity in Yichang.
- Overall coin battery pricing remains flat, with a few part families trending up due to material price increases and capacity constraints.
- Re-chargeable battery pricing expected to go up to due raw material price increasing (over 25%）and strong demand.
- Approving additional and alternative sources is recommended to counter against supplier increases.
- The price of lithium metal increased by more than 250% since the end of 2020, see below cost chart.
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