According to ESMC, on March 2, Murata issued a notice, indicating that due to the ever increasing demand for high-performance laminated ceramic capacitors in the communications and automotive markets, MLCC manufacturers including Murata have been unable to meet the overall needs.

Murata said that due to the large increase in overall demand, Murata must concentrate its production resources on small-size, high-performance and high-end products with large market demands. For the “old product groups”which already have the small-size substitutes, the companyhas toreduce its production capacity 50% lower than in 2017 and this trend will continue in the future.

In addition, as other MLCC manufacturers continue to increase price, the orders of "old product groups" such as "0603/0805 with high dielectric constant and  electrostatic capacity below 1uF" continue to rush to Murata, resulting in difficult adjustment of Murata capacity.

As a result, Murata is planning to reduce its orders for “old product groups” through miniaturization and multiple supplier certifications, as well as transfer the orders to Taiwan MLCC vendors.

In order to strengthen the control over the over-concentration order of  the "old product groups", Murata will start the initial price adjustment for the following products, the new order price will take effect on March 2, 2018.

At present, the major global suppliers of MLCC include Murata, TDK, Taiyo Yuden, Kyocera, Panasonic, Yageo, Walsin, Fenghua Hi-Tech, etc. Japanese manufacturers take up the majorityof the production capacity. However, since the second half of 2016, large Japanese manufacturers such as Murata, Taiyo Yuden, TDK have planned to phase out the medium and low-end MLCC products due to the increasing demand for automotive industry and iPhone.

Before Murata, the Japanese giant Kyocera has already announced the discontinuation of some specifications. At the beginning of February, Japan's big factory Kyocera has announced that it will suspend MLCC with the type 104/105 of size 0402 and 0603 by the end of February. These are the specifications that has the largest market demand and volume.

Earlier on in 2016, TDK, the company which accounts for 7% of MLCC's global market, also announced its plan to fade out of the general MLCC market.

Japanese major players gradually withdrew, while new capacity in Taiwan and the mainland failed to be opened in time, together with  the surge in market demand, the MLCC market in 2017 was in a tight supply situation. MLCC manufacturers such as Yageoand Fenghua Hi-Tech went through several rounds of price increases, Wang Jinquan, the president of Fenghua Hi-Tech, used the word“insane” to describe the price increase of MLCC.

In 2018, MLCC's stock shortage and price increase continued. Murata China President Maruyama Hideyoshi also said in an interview with ESMC recently that MLCC manufacturers capacity could not meet the surge in demand, and MLCC stock shortage will not be alleviated until the end of 2018.

It is reported that due to continuous blizzards in Honshu Island in Japan, many factories of Murata have stopped production. Now it has announced that by 50% of the production reduction on some of the products and prices increase, coupled with the same trend of Kyocera, the MLCC market is likely to usher in a more serious stock shortage and price increase period.