Murata officially raises prices, ushering in a new era of price increases in the global passive component market

The global passive component market is brewing a new wave of price increases. As early as February this year, Murata Manufacturing announced that it was carefully evaluating the price increase of its most advanced multilayer ceramic capacitors (MLCC).

Unexpectedly, the final decision was made in a short period of time. Murata subsequently announced that four major categories of products, including multi-layer ferrite beads, multi-layer ferrite power inductors, multi-layer RF inductors, and multi-layer common mode chokes, will have their prices fully increased starting from April, officially kicking off this round of passive component price increases.

The core driving force behind this price increase comes from the rapid rise in raw material costs.

Murata pointed out that silver, as a key material, is widely used in solar energy, electric vehicles, semiconductors, AI equipment, and medical fields, and the demand continues to grow rapidly. However, due to the fact that silver is mostly a byproduct of other metal mining, its supply elasticity is limited, resulting in a long-term supply shortage in the market.

According to relevant institutional data, silver demand has consistently exceeded supply since 2021. Under the dual effects of demand expansion and capacity constraints, the rate of silver price increase has significantly accelerated, forcing manufacturers to shift cost pressures downstream.

Murata stated that “the recent price increase has exceeded the level that we can absorb through our own cost cutting efforts.” Therefore, the announcement of price increases began in April.

Murata has launched a comprehensive price increase for AI servers and high-end MLCC products, with an increase range of about 15% to 35%. The new price system will officially take effect from April 1st (subject to order confirmation time).

As the world’s largest MLCC supplier, Murata has a market share of over 40% and a market share of approximately 70% in the AI server field.

This is its first large-scale price adjustment in nearly three years, and the market generally believes that this move may mean a new upward cycle for the global passive component industry.

There are also signs of linkage in the industrial chain. Market reports suggest that Samsung Electro Mechanics is also planning to launch its first round of price increases in April, driving up overall price expectations. The industry is optimistic, such as Guoju and Huaxin Technology, which are expected to benefit from this wave of price increases.

From the demand side, the continuous explosion of AI servers and ASIC computing power demand has led to a significant increase in the usage of high-order MLCC and tantalum capacitors.

According to the report, the demand for high-end MLCC orders has significantly exceeded the production capacity supply. Due to the high technical threshold and long expansion cycle of the products, the delivery time has been extended from 10-12 weeks to 14-16 weeks.

Meanwhile, the price of tantalum capacitors has recently risen by about 10% to 20%, indicating that the tight supply and demand situation of high-end passive components is expanding.

It is worth noting that as the demand for high-end products continues to rise, the effect of capacity crowding out is beginning to emerge.

If manufacturers prioritize the allocation of production capacity to high-order MLCCs with high gross margins, it may compress the supply space for mid to low order products, and the related impact is expected to gradually become clear in the second quarter.

At present, domestic channels and spot markets have taken the lead in reflecting the expectation of price increases, with some mid to low end MLCC prices rising, indicating that the transmission of industry chain prices is accelerating. Overall, under the resonance of rising raw material prices and AI demand, the passive component market is entering a new stage of tight supply and demand and rising prices.