MLCC surges again, with Walsin Technology and Yageo orders simply overwhelming

Created on 08.12

According to a report by Taiwan's Economic Daily News on August 10, driven strongly by the AI industry, global demand for passive components has surged significantly. Core MLCC manufacturers have full order books with capacity nearing full utilization, and product lead times have extended to 12 to 16 months. Currently, major manufacturers prioritize capacity for large clients, while small and medium-sized clients are bidding up prices to secure supply, with some urgent orders quoted at two to three times the original price, creating a strong atmosphere of price increases in the market.

Leading Taiwanese manufacturer Yageo admitted that current MLCC market demand is very robust, with capacity utilization, new project implementation, and long-term contract demand all continuing to rise. To avoid future supply risks, an increasing number of AI-sector clients are choosing to lock in capacity in advance. Previously, Yageo's earnings call predicted a recovery in industry supply and demand. This quarter, the company's standard product capacity utilization is expected to rise from 80% in Q2 to over 90%, while special product capacity utilization remains at a high level above 90%, with overall capacity gradually moving toward full utilization.

To match the surging market demand, Yageo is advancing capacity expansion across multiple production bases, including Kaohsiung in Taiwan, Suzhou in mainland China, Vietnam, and Mexico, with new capacity being released quarter by quarter as equipment arrives. The industry is also witnessing a new trend: AI-related clients are competing to sign long-term agreements, locking in passive component supply channels for the next six months or even several years to reduce the risk of supply chain disruptions.

Industry analysis indicates that global mainstream MLCC manufacturers prioritize capacity supply for large clients and long-term partners. With the rapid proliferation of high-end applications such as AI servers and data centers, demand for high-capacitance, high-reliability MLCC products has surged, and large clients receive higher priority in capacity allocation, squeezing supply for small and medium-sized clients. To avoid component shortages affecting terminal production, smaller clients are forced to pay premiums to secure goods, further driving up market prices.

Another major Taiwanese MLCC manufacturer, Walsin Technology, also has a full order book. The company's general manager, Tseng Ming-tsan, revealed that recent order momentum has improved significantly, with the book-to-bill ratio (B/B value) climbing to 1.8. Industry indicators show that a B/B value above 1 signifies industry expansion, 1.5 already indicates a high prosperity range, and a value of 1.8 highlights the unprecedented heat in the current MLCC industry. At present, demand across the entire product line, including MLCCs and resistors, is rising simultaneously. Orders are led by AI servers, with computer, automotive, and consumer electronics demand following suit, and order visibility exceeds six months.

At the same time, a clear order transfer effect is emerging in the industry: international major manufacturers are concentrating high-end capacity on high-growth tracks such as AI servers, squeezing capacity supply in the consumer electronics sector, with the remaining market gap being filled by other suppliers. AI is not only directly driving demand for passive components in servers but also promoting a reallocation of capacity across the global passive component supply chain. In terms of pricing, the industry has already entered a price adjustment mode, with overall prices being dynamically raised in response to supply-demand relationships, cost changes, and customer acceptance.

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