Chip Prices to Rise Further in Q4 by 10 - 20% due to Tight Capacity

Published: Oct 11, 2021 10:23

Save

The continued tight production capacity has prompted chip makers to raise the prices of chips again in Q4 with a range of 10 - 20%. The main reasons include semiconductor supply chain shortages, no signs of recovery in the foreseeable future, and the increasing costs of some key supporting sectors (foundry, raw materials, logistics, etc.).

SHANGHAI, Oct 11 (SMM) - The continued tight production capacity has prompted chip makers to raise the prices of chips again in Q4 with a range of 10 - 20%. The main reasons include semiconductor supply chain shortages, no signs of recovery in the foreseeable future, and the increasing costs of some key supporting sectors (foundry, raw materials, logistics, etc.).

The supply of PMICs for mobile phones is still tight, and domestic manufacturers are expected to benefit from the current situation. According to DIGITIMES Research estimate, the global shipments of PMICs for smartphones will reach 9.41 billion units in 2021, up 26.7% year-on-year, and are expected to maintain strong growth in 2022-2023, with growth rates of 29.9% and 26.0% respectively.

On the demand side, the penetration rate of 5G mobile phones continue to rise, while the number of RF front-end chips and modules expands, and the demand for individual PMICs grows significantly. On the supply side, PMICs for smartphones mostly use 0.11/0.18 micron BCD process, with production capacity concentrated in 8-inch. 8-inch BCD production capacity is currently in short supply. Furthermore, it is difficult to switch from 8-inch to 12-inch production capacity for a short period of time, so the production capacity will continue to be tight. On the other hand, the PMICs bundled with Qualcomm and MediaTek are at risk of running out of stock, so the proportion of bundled sales is being reduced and some product types are being released to provide alternative opportunities for international makers such as ST and Maxis, as well as domestic manufacturers such as Shengbang, Aiwei Electronics and Nanxin.

Though the current demand for semiconductors has demonstrated certain structural differentiation, the overall supply remains tight amid a booming market. The existing demand is solid, and 5G, new energy, photovoltaic, "new infrastructure" and other innovative applications have created massive new demand. At the same time, localisation is being vigorously promoted, and foundries and IDMs are continuing to expand production to meet increasing demand, thus benefiting the whole local semiconductor industry chain, with strong, long-term growth momentum.

chip shortage growth momentum

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or for more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

Jul 3, 2026 21:29

Shanxi Kelite to Launch $100M Light Alloy Die-Casting Project in July, Targeting Robotics and EV Markets

[SMM Magnesium Express]Recently, it was reported that Shanxi Kelite Precision Casting Technology Co., Ltd. plans to officially commence production of its light alloy integrated die-casting project in mid-July. With a total investment of 100 million yuan, the project can produce 8 million lightweight robotic precision structural components annually, primarily serving sectors such as meal-delivery robots, household service robots, and new energy vehicles. Leveraging Shanxi's magnesium ore resource advantages, the company has successfully transformed from a traditional pipe-casting enterprise into a high-end precision manufacturing entity. It has introduced cold high-pressure die-casting core technologies and established a provincial-level doctoral entrepreneurship station in collaboration with North University of China. With the project's launch, the large-scale application of magnesium alloy in intelligent robotics and new energy vehicles is expected to deepen further, accelerating the transition of traditional casting enterprises toward high-end magnesium alloy manufacturing.

Jul 3, 2026 21:29

Jul 3, 2026 21:27

IML and Chongqing Yujang Die-Casting Partner for Semi-Solid Magnesium Alloy Advancements

[SMM Magnesium Express]On July 3, IML and Chongqing Yujang Die-Casting officially established a strategic partnership in semi-solid magnesium alloy forming technology. The two parties will collaborate closely on technological R&D, mass production breakthroughs, and market applications, while deploying multiple large-scale semi-solid injection molding equipment for magnesium alloys. The cooperation aims to integrate the entire chain from materials and processes to mass production, focusing on scaling up the application of magnesium alloys in critical components such as electric drive housings and vehicle structural parts. This will provide high-performance lightweight solutions for industries like new energy vehicles, 3C electronics, and humanoid robots. With continuous progress in industrial chain collaboration, the mass production barriers for semi-solid magnesium alloy forming are expected to be accelerated, further speeding up the process of large-scale application.

Jul 3, 2026 21:27

Jul 3, 2026 18:37

[SMM Tungsten Analysis] Global Tungsten Markets Diverge in June: China Pulls Back, Europe Holds High

In June, global scrap tungsten markets diverged. India followed China's tungsten price rally, with active trading and higher prices in mid-June before cooling as China softened. Europe saw low-level consolidation due to high speculative inventories, but prices began to edge up in late June as stocks cleared. China's tungsten market experienced a sharp rebound followed by a pullback, and is expected to consolidate in the near term, while medium-to-long-term fundamentals remain solid.

Jul 3, 2026 18:37