Inventory freeze and suspended quotations – what‘s happening in the resistor and MLCC markets?

01 What's going on in the market right now?

First, the suspension of quotations does exist. Many chip distributors have said that since about last week, suppliers have been reluctant to provide them with quotes.

One passive component agent explained that the main reason is that the original manufacturers need to adjust prices, and the market is too volatile, making it difficult to quote. As a result, they have suspended order taking and quotations, and will resume only after the original manufacturers and internal adjustments are made. Another distributor specializing in passives mentioned that they stopped taking orders and quoting last Friday, and expect to resume in the first two days of this week.

Some distributors observed that last week, the suspension mainly affected resistors, while capacitors were more of a "shortage" issue. In the past couple of days, resistors have slowly begun to resume order taking.

On the other hand, both resistors and capacitors have seen sharp price surges.

First, let’s turn to resistors. Toward the end of last year, domestic passive component makers rolled out batches of price hike announcements, the majority issued by resistor producers. Consequently, spot trading of passive components faced halted quotations and rising prices around New Year’s Day.

After New Year's Day, the overall price of resistors rose by about 10–20% compared to before the holiday, with the main price‑increase models being 0201–1206. Quotations were somewhat chaotic at first, with different models seeing increases of ten‑odd percentage points, thirty points, or even more for niche or tight models. However, after about a week, price fluctuations gradually diminished, and the market stabilized.

Now, back to the present. Some distributors say that resistors went up another 10 percentage points last week.

During the New Year wave of passive component price increases, capacitor prices did not rise much overall. However, some distributors noted that certain tight models—such as polymer tantalum capacitors and high‑capacitance, high‑voltage ceramic capacitors—remained in short supply.

High‑capacitance capacitors have continued their upward trend unabated. After May, even standard capacitor materials began to see price increases, and the surge in the last week or two of May has been particularly astonishing. From the last week of May until now, many distributors have reported that "capacitor prices change every day," "they doubled in a single day," and for some parts, "prices have risen two to five times, even more for high‑capacitance types." Some distributors even note that foreign goods are now cheaper than domestic ones. At the same time, our sources at XinShiXiang have found that due to the rapid price changes, few people seem able to say exactly how much capacitor prices have actually increased during the verification process.

Overall, in the current spot market, capacitors seem to be generating more "buzz" than resistors, with even more dramatic price increases.

However, some have noted that the actual price hikes from distributors and original manufacturers are not that extreme. For the same part, a major distributor's quote has risen only about 15 percentage points compared to March, while prices in the open market have already doubled.

Beyond price increases, "shortages" are also an unavoidable topic in this round. Some distributors say they see listings online for large quantities, but when they inquire, the response is "out of stock" – "already cleaned out." Others mention that capacitor shortages have become so severe that even parts dated 2022 are being put up for sale.

Amid this "frenzied" situation, some sense something unusual. One person shared that most of the activity now involves the same goods being shuffled around within the market, while actual shipments to real end customers don't seem to be that high. An agent also noted that their transaction volume with customers in May was actually lower than in April.

In summary, the current passive components market is indeed very hot – some even say this round is more exaggerated than the passive component surge in 2018. However, while everyone can feel the sharp rise in capacitors and resistors, specific increases and affected ranges vary from person to person due to the wide variety of passive component types and brands. Moreover, as the market is still in a relatively "frenzied" phase, further developments remain to be seen.

02 From Price Increase Notices to 'Order Suspension' – How Did the Resistor and Capacitor Market Rally Come About?

This round of passive component price increases didn't come out of nowhere — it started in the second half of 2025 and has been spreading ever since.

Q4 2025: Starting from November, Taiwan-based Chilisin took the lead to raise bead prices by over 15% and cut production. Then in December, multiple domestic thick-film and chip resistor manufacturers including Fujie, Hekotai and Changlong Technology issued price increase letters in bulk, with hikes ranging mostly from 8% to 20%.

Q1 2026: Price hikes spread from medium and small factories to industry leaders. Fenghua Advanced Technology, Walsin and Yageo raised prices one after another; Yageo directly lifted chip resistor prices by 15%-20% in February.

Q2 2026: Major Japanese and Korean suppliers joined the wave. In April, Murata raised prices of MLCC for AI servers and high-end automotive applications by 15%-35%, while Samsung Electro-Mechanics hiked its full MLCC lineup by 5%-10%. In May, Taiyo Yuden increased prices for multiple product lines. Yageo and Kemet launched another round of price hikes starting June, bringing their total price increase from late last year to this year up to 65%.

Overall, the price rally kicked off with small and medium domestic manufacturers, followed by leading local players, then Japanese and Korean giants. The upward trend expanded from resistors and beads to MLCCs.

However, what truly pushed resistors and capacitors into the spotlight may not have been these price increase notices, but rather the rumors of "order suspensions and temporary hold on new orders" that emerged over the past week – which also served as the direct trigger for the current explosion in the resistor‑capacitor market.

On May 27 (last Wednesday), the Commercial Times reported that Fenghua had fully suspended new orders from domestic agents for its 0402 and 0603 chip resistors and MLCCs. As soon as the news broke, market sentiment ignited instantly. However, Fenghua issued a clarification on June 1, stating that the claim of a "full suspension of order taking" was untrue – only some products had been temporarily put on hold, and orders had already resumed as of the announcement date. The temporary hold was for digital system upgrades and product portfolio adjustments.

On May 29, the market began to see actual instances of order suspensions. According to information gathered so far, some sources added that the relevant news first came from distributors.

The groundwork laid by price increase notices, combined with rumors of order suspensions, met a market that was already eager to move and driven by speculative sentiment. The small spark of price hikes instantly spread. Upon closer examination, apart from the direct factors mentioned above, the resistor and capacitor price increases also have their own respective reasons.

Let's start with resistors.

The first to buckle under pressure was raw material costs. Silver paste is a core material for resistors, inductors, and chip beads, and the sharp surge in silver prices became the direct trigger.

According to data from TEJ (Taiwan Economic Journal), the London silver fixing price soared from $36.2 per ounce in July 2025 to $103.2 per ounce in January 2026 — a nearly 185% increase in six months. To put this in perspective, silver paste accounts for over 50% of the material cost of multilayer inductors and chip beads. One can only imagine the cost pressure on resistors and inductors from such a price surge. Copper prices have also risen, climbing from an average of $9,000 per ton in 2024 to $13,370 per ton — a 49% increase.

Unable to bear the cost pressure, manufacturers began cutting production. Starting in December last year, some second‑tier resistor manufacturers, such as Fuji Electronics, began reducing output to limit losses.

The path to price increases for MLCCs, however, is more complex, because it involves the major variable of AI.

During the New Year wave of price hikes, the overall increase for MLCCs was actually not that significant — only tight models such as polymer tantalum capacitors and high‑capacitance, high‑voltage ceramic capacitors saw noticeable rises. But starting in May, even standard MLCCs began to experience widespread price increases. There are three main reasons behind this:

First, reduced arrivals at distributors, coupled with rising channel sentiment. Some distributors have indicated that their incoming shipment volumes have decreased to varying degrees in recent months.

Second, major Japanese and Korean manufacturers are shifting their production capacity toward high-end applications, which has reduced the supply flexibility for consumer-grade products. According to the latest survey from TrendForce, the surging demand for AI chips has led to a tight supply–demand balance for high-end MLCCs and also squeezed the supply of consumer-grade MLCCs. This has prompted some distributors to engage in precautionary stockpiling, to which suppliers have responded with price adjustments.

Third, the "major forecasts" from Morgan Stanley and Goldman Sachs. Around May 20, Morgan Stanley conducted a bill-of-materials (BOM) analysis of NVIDIA's next‑generation Rubin platform. The findings revealed that the MLCC value per rack jumps from $1,530 on the GB300 platform to $4,320 on the VR200 platform — a staggering 182% increase, second only to PCBs (+233%), ranking as the second‑highest increase among all components. Goldman Sachs was even more direct, dubbing MLCCs the "next supply bottleneck" in the AI supply chain. The firm estimates that demand for MLCCs from AI servers will grow approximately 4.3 times between fiscal years 2025 and 2030, while the industry's annual production capacity is increasing at a rate of only slightly above 10%.

Taken together, the current resistor and capacitor market rally has been driven by multiple factors: rising silver prices, growing AI demand, channel stockpiling, and rumors of order suspensions. Market sentiment continues to heat up. Coupled with Morgan Stanley's assessment of MLCCs as the "next supply bottleneck," the notion of a "next memory-like cycle" has also begun circulating in the market.

However, whether the rally can sustain itself depends on two core questions: First, whether end customers can absorb the current price increases and increase their inventory build-up. Spot prices are rising rapidly, and some distributors have already noted that customers are becoming more inclined to wait and see. Second, whether the structural divergence between high-end and standard products can persist. The current supply tightness is mainly concentrated in AI‑related high‑end MLCCs and tantalum capacitors; the trend for general‑purpose parts remains to be seen.