PASADENA, Calif.--(BUSINESS WIRE)--The latest data from Supplyframe points to seemingly insatiable demand for electronic components and semiconductors for 2022. Global manufacturers can expect severe supply constraints and cost inflation pressure for many component categories into 2023, according to the report. The new industry intelligence also anticipates extended electronic component lead times, with 70% of all lead-time dimensions forecast to increase.
“Last year we saw unprecedented electronics commodity demand across end market segments, and our new data indicates that voracious demand will continue in 2022, driven by consistent consumer spending and infrastructure investments in a variety of markets,” said Steve Flagg, CEO and founder of Supplyframe. “The 277% year-over-year increase in design activities uncovered by our Design-to-Source Intelligence (DSI) Network provides evidence of this trend.”
But at the same time, the COVID-19 pandemic, capacity constraints, and raw material shortages will continue to challenge the electronics value chain as will ongoing labor shortages, manufacturing capacity, and transportation disruptions through the first half of 2022, according to the Commodity IQ report. For select components like analog components, complex semiconductors, frequency control devices, and some resistors, the suffering will last even longer. Severe supply constraints and price escalations for these categories appear likely to last for all of 2022 and into 2023.
“As Commodity IQ highlights, the new year begins with continuing commodity challenges, some of which will drag into next year,” added Flagg. “However, a cautious optimism exists for passive components in the second half of the year, particularly for standard connectors and ceramic capacitors, suggesting the passives market will recover faster than its actives counterpart. Pricing and lead time dimensions across most passive commodities are forecast to stabilize beginning in Q3.”
Powered by Supplyframe’s DSI, Commodity IQ uses a unique combination of analytics and analysis to provide actionable intelligence for electronics industry practitioners. Commodity IQ is underpinned by commodity sourcing experts at more than 350 Supplyframe DSI Network partners managing more than $120 billion of direct material spending and by the powerful analytics generated by more than 10 million sourcing professionals and electronics engineers.
Commodity IQ is available via an annual subscription and delivered in a continuously updated environment that includes critical alerts across commodities. It features rolling four-quarter forecasts for the crucial sourcing dimensions of market dynamics, pricing, and lead time. It provides numerical, supplier, industry, and curated expert insights for added context. Commodity IQ also identifies design and demand trends, including engineering design cycle patterns and predictions as well as sourcing signals by commodity and sub-commodity. And in Q1 2022, it will be enhanced to include commodity lead times based on hundreds of thousands of manufacturer part numbers quoted.
Supplyframe’s unmatched industry ecosystem, and pioneering Design-to-Source Intelligence (DSI) Solutions, are transforming how people and businesses design, source, market, and sell products across the global electronics value chain. Leveraging billions of continuous signals of design intent, demand, supply, and risk factors, Supplyframe’s DSI Platform is the world’s richest intelligence resource for the electronics industry. Over 10 million engineering and supply chain professionals worldwide engage with our SaaS solutions, search engines, and media properties to power rapid innovation and optimize in excess of $120 billion in annual direct materials spend. Supplyframe is headquartered in Pasadena, Calif., with offices in Austin, Belgrade, Grenoble, Oxford, San Francisco, Shanghai, and Shenzhen. To join the Supplyframe community, visit supplyframe.com and follow us on Twitter, Instagram, and YouTube.