If There's a Shortage, Why Are Semiconductor Prices Weak?
The Chip Insider®
July 9, 2021— Strategy and Tactics: If there's a shortage, why are semiconductor prices weak? WildPhotons: There's always clarity when...
G. Dan Hutcheson
Summaries: If there's a shortage, why are semiconductor prices weak? With recent projections that the chip shortage could last into 2022 and beyond, contrasted against declining semiconductor prices, we've been getting many questions. Yes, there was a semiconductor ASP decline between January and April, which could be seen as contraindicatory of a shortage. A fairly detailed analysis found it was due to mix shifts from high-priced, low-volume ICs to low-priced, high-volume ICs. Prices and volumes are orders-of-magnitude different between categories, so much of the recent price fluctuation has been noise.
One way to strip the noise is to look at revenue per silicon-area-equivalent because variations in die size cancel out unit price-variations to a great degree. If you do that, the Sales/Wafer (300mm-equivalents) were up in March and flat in April. It also declined between November and February, which was smack through the hottest season of the shortage. Now, why are unit ASPs and wafer ASPs so different? One is ... So is there really a shortage? The CPPI in the TCI Graphics and utilization levels certainly indicate a shortage. The bigl problem is measuring real demand. This has four parts, which are hard to parse... Putting this puzzle together, my judgement is that conditions are currently normal and the source of what people call a shortage is...
ChipChirpsTM — VLSI's Semiconductor Analytics report and more. Semiconductor sales sunk wk/wk, in a normal end of the back-to-school build cycle. Yet, Y/Y growth was in the mid-double digits. Focusing on Logic ICs, Y/Y growth MAs closed in on 25% last week, with the growth forming an inversion of last year's 2Q trend. Auto hit it out of the park with another triple-digit Y/Y gain last week. DRAM and Analog & Power were close behind, NAND followed. Logic is forecast to grow 18% Y/Y in 2021 versus 10% in 2020. ChipChirps are short notifications from VLSI's analysts to alert clients about breaking news and events. They are exclusively available on VLSI's App for Android and iOS.