Supplyframe Commodity Intelligence Quarterly Points to Increasing Risk and Supply Constraints for Manufacturers

CIQ Solution Delivers Unparalleled Insights Amid Significant Shortages for the Global Electronics Value Chain

PASADENA, CALIFORNIA – The worldwide shortage of semiconductors is expected to last for years to come amid increasing risk and supply constraints. New Supplyframe market intelligence indicates that significant shortages will continue through the first quarter of 2023 at a minimum.

Supplyframe just released the latest version of its Commodity Intelligence Quarterly (CIQ). CIQ delivers connected, contextual and forward-looking expert insights on market dynamics, pricing, lead time, demand, and design cycle dynamics impacting supplier, regional, and raw material trends related to electronic hardware and sourcing strategies.

The third quarter CIQ revealed a 77% growth of “red” dimensions in the supply and demand market dynamics heat map, which was previously a mix of yellows and reds. This CIQ also highlighted that there has been an increase in component prices of up to 40% as compared to last quarter. This new Supplyframe CIQ research also uncovered the fact that microchip analog device lead times are becoming longer as buffer inventory has now been committed. The new average lead times are between 25 and beyond 52 weeks – and, in some cases, up to 60 weeks.

The latest CIQ comes as semiconductor production and testing have been hampered by a water shortage and COVID-19 outbreaks in Taiwan, where nearly half of the world’s semiconductors are manufactured. CIQ diagnoses major electronic commodity groups and subgroups, including the far-reaching and interconnected COVID-19 impacts that remain in the form of steep demand recoveries, extended lead times, and dramatic raw material and component price escalations.

The world’s reliance on electronics components, particularly semiconductors; the unexpected surge in demand and resulting shortage in semiconductors in the automotive sector; and the uncertainty in Taiwan indicate that the time is ripe for CIQ. Just look at what is happening in the automotive industry. The top four semiconductor manufacturers serving the automotive sector continue to struggle with shortage issues, which are only getting more dire. As automotive companies rounded out the first half of 2021, the electronic component shortage became worse in the second quarter as compared with the first quarter, and also against the baseline of demand and supply availability in the third quarter of 2020. The Supplyframe Design-to-Source Intelligence (DSI) Network availability measures also indicate that the percentage of chips out of stock by the top four manufacturers serving the automotive sector worsened by 14 points quarter over quarter and by 22 points vs. the baseline (2020 Q2-2020 Q4).

“Supplyframe CIQ provides an unmatched level of market intelligence for an industry that is deep into shortages and risks coming from every angle,” said Steve Flagg, CEO and founder of Supplyframe. “CIQ is critical for navigating the numerous obstacles in the present as well as future opportunities.”

With CIQ, manufacturers can safeguard their businesses from costly and frustrating scenarios. No other intelligence service provides both engineering and sourcing signals – based on billions of intent, demand, and risk parameters via the Supplyframe DSI Network – that offer a framework for tactical and strategic decision-making.

CIQ is derived from critical, real-world insights and the commodity management expertise of industry leaders and Supplyframe DSI Network partners. Industry and market research providers, including more than 500 companies across the electronics value chain, including global manufacturers, EMS providers, distributors, semiconductor and component suppliers, also provided expertise. Derived demand and design cycle insights are identified from billions of signals from engagement across the DSI Network including more than 70 vertical search, community, and content sites; more than 10 million monthly engagements from engineering and procurement professionals; more than $120 billion in annual direct materials spend management; and more than $500 million of ecommerce transactions.

Contributors to CIQ are commodity, sourcing, and engineering professionals, including more than 30 subject matter experts managing hundreds of millions of dollars of annual direct material spend. CIQ is unique in its ability to deliver historical and forecast detail on market dynamics, pricing, and lead time analysis across the entire electronic component landscape.

Discover CIQ on the Supplyframe website.

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