Material Constraints Update: April 2019

While material constraints are likely to occur through the rest of 2019, overall trends are are positive. Lead-times are decreasing in most component types and Burton Industries is seeing less allocation and backorders. Here is what our supply chain team is seeing by commodity:brochurepg1c

  • Analog – (Sensors, Power, Regulators ) Stable to Decreasing – 10-12 weeks.
  • Batteries – Stable – 8-12 weeks.
  • Connectivity (WIFI, Bluetooth, Cellular) Microchip lead-times increase to 18-20 weeks, many manufacturers Stable 12-16 weeks.
  • Discretes (MOSFETS, Varistors, ESD, Didoes, Rectifiers)  Overall decreasing, however some lead-times are still high at 12-26 weeks.  Very positive signs here.
  • Electromechanical – (Power Supplies, Relays) -Stable to Decreasing 10-14 weeks.
  • 8 bit MCU, 32 bit MCU, LCD’s , FBGA– Stable to Decreasing.
  • Interconnect –  Stable with the exception of automotive connectors which are extended 26-40 weeks.
  • LEDs – Stable 8-10 weeks.
  • Memory – Stable 4-12 weeks.
  • Passives
    • Capacitors
      • Electrolytic – Still at 14-18 weeks with some pricing increases (NIC, Nichicon).  Panasonic is seeing Decreasing lead-times at 14-18 weeks with stable pricing.
      • Film Capacitors – Stable- Lead-times 12-16 weeks.
      • Tantalum Capacitors – Decreasing to 11-14 weeks, pricing is stabilizing.
      • Polymer Tantalum Capacitors – Stable 12-16 weeks.
    • Resistors
      • Fixed – Decreasing- Lead-times still high at 16-30 weeks.  Rohm is in allocation and selective pricing adjustments per market are still being made.
      • SMT General (Less than 1UF) Decreasing – Lead-times still range 16-30 weeks.

 

 

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China Tariff Update

While negotiations have been slow, resolution on a trade agreement with China that would eliminate the current tariffs seems to DSC05352be continuing to move forward. According to Bloomberg News, line-by-line negotiation on an agreement with China is underway. The 10% tariff on printed circuit boards (PCBs) and components fabricated in China remains in place, but has not escalated. As mentioned previously, even with the 10% tariff, in many cases, China remains the most competitive option for PCBs. We continue to monitor the situation and review alternate sourcing options.

Stocking Arrangements to Mitigate Supply Chain Disruption

Common Stocking Arrangements to Minimize Supply Chain Disruption_Page_1Material constraints continue to add challenges to electronics manufacturing. That said, the team at Burton Industries has implemented stocking arrangements with many of our customers designed to ensure that product will be available even when spikes in end market demand or further changes in material availability impact forecast assumptions. Our latest whitepaper, Common Stocking Arrangements to Mitigate Supply Chain Disruption, looks at the types of stocking programs available and their benefits and potential challenges. Read the full paper here.