Prices for large-size chip resistors to rise 5-10% in 1Q11 - ResearchInChina

Date:2011-01-07liaoyan  Text Size:

Chip resistor makers are mulling plans to raise quotes for large-size products, including 0603-and-above sizes, by 5-10% later in the first quarter of 2011 to reflect tight supply, according to industry sources.

The sources explained that companies are actually reluctant to scale up production for 0603 and above chip resistors due to the segment's low ASPs. The shortage is mainly due to limited available capacity in the market, the sources said. Therefore, suppliers expect to adjust upward prices for certain large-size chip resistors in order to help lift their gross margins.

Leatec Fine Ceramic, for instance, managed to improve its gross margins to more than 30% in the third quarter of 2010 thanks to price hikes of substrate products.

In other news, Leatec announced it has secured a 5-year NT$750 million (US$25.6 million) syndicated loan agreement with a banking consortium. The company expects to use the new funds to expand capacity mainly for heat sink substrates for LED backlighting and substrates for automotive electronics applications.

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