MLCC Mega Shortage? Manufacturers Expect Supply Crunch to Last Until 2027!

01 MLCC Shortage Spreads Across All Segments

According to Taiwan’s Commercial Times, citing sources from component distributors, the MLCC shortage is no longer confined to AI-grade MLCCs; mainstream specifications across the board are facing supply shortages.

To fulfill high-end MLCC orders, manufacturers including Murata and Samsung Electro-Mechanics have been forced to turn down low-end orders. Such low-end products are primarily deployed in consumer electronics. While they only account for 10%–15% of revenue at these Japanese and Korean suppliers, they make up over 40% of their shipment volumes.

Walsin Technology also stated that the 47μF model is currently the most undersupplied specification. As high-volume AI-related high-end orders squeeze production capacity at Japanese and Korean manufacturers, high-capacitance variants widely used in smartphones and PCs—namely 10μF, 22μF and X5R dielectric types—have also been impacted.

Walsin Technology forecasts the ongoing MLCC shortage will last into 2027 or even 2028, potentially outlasting the passive component shortage crisis of 2018.

Tseng Ming-Tsan, General Manager of Walsin Technology, pointed out that the AI server market totals several million units, while the AI PC market reaches as high as 200 million units. Once memory supply stabilizes and shipments of AI edge devices surge, the supply crunch could worsen further. The demand surge for passive components driven by AI infrastructure is only the first wave.

Yageo, the leading manufacturer of passive components, has posted an order-to-shipment ratio above 1.3, surpassing Murata. Chen Tai-Ming, Chairman of Yageo, remarked that based on the company’s order backlog, “The second half of the year will be extremely busy; stay tuned for price adjustments.”

Industry players along the supply chain have ramped up capacity expansion to bridge the supply-demand gap. Nevertheless, extended lead times for upstream production equipment have become a major bottleneck holding back capacity expansion of passive components.

Walsin Technology disclosed that lead times for equipment from Japanese suppliers range from six months to one year, while those from Taiwanese equipment makers stand at three to six months. Although the company holds priority placement in the order queues of equipment vendors, its capacity expansion progress still fails to meet expectations.

Hosonic Electronic stated that lead times for high-end passive component manufacturing equipment have stretched to one to one and a half years. The production equipment the firm plans to introduce in the second half of the year stems from procurement orders placed two years ago.

02 Shortage Spreads to Consumer Sector, Some Lead Times Extend to 20 Weeks

Institutions pointed out that AI has driven higher demand and upgraded specifications for passive components, prompting numerous manufacturers to shift their focus to AI-related products. This shift has resulted in a supply-demand imbalance in the market, with component shortages gradually spreading to consumer electronics segments.

AI computing infrastructure has fueled simultaneous growth in demand and specification upgrades for passive components. Demand for high-capacitance, high-withstand-voltage, low-loss MLCCs as well as high-end power inductors has risen markedly. This trend has not only multiplied the component consumption per single device, but also lifted the average selling price (ASP) of products. Moreover, relevant manufacturers have seen their high-end production lines operate at nearly full capacity. Lead times for certain products have stretched beyond 20 weeks, and product prices have been raised successively, ushering the entire industry into a growth cycle.

In addition, the world’s major suppliers are concentrating resources on high-end products such as AI servers and shifting production capacity toward high-value-added segments including AI servers, high-performance computing (HPC) and automotive electronics. This has created a capacity crowding-out effect on output originally allocated to consumer electronics.

Though consumer electronics account for a small share of revenue for these manufacturers, they represent over 40% of total shipment volumes, which risks triggering a supply-demand imbalance in the market going forward. Industry sources note that component shortages are gradually spreading to consumer electronics, with commonly used specifications for smartphones, laptops and PCs now facing tight supply.

03 Vast Potential for Domestic Substitution

MLCCs (Multi-Layer Ceramic Capacitors) are known as the "staple grain of the electronics industry". Driven by the continuous expansion of AI computing infrastructure and accelerating penetration of new energy vehicles, demand for MLCCs has seen exponential growth. Meanwhile, the product mix of MLCCs is upgrading, bringing a marked increase in per-unit value content.

Data from SemiAnalysis shows the MLCC value content per server rack has climbed from approximately USD 3,000 for the H100 platform to around USD 12,000 for the GB200 platform, and is projected to rise further to roughly USD 22,000 for the Rubin VR200 platform.

A research report by CITIC Securities states that buoyed by robust AI-driven demand, the MLCC industry is entering a new round of price hikes and an upward prosperity cycle. The firm holds a positive outlook on domestic manufacturers, which are well-positioned to seize market opportunities and accelerate breakthroughs in high-spec products for servers and automotive-grade applications.

According to Shanghai Securities, China’s domestic MLCC industry boasts complete mid-to-low-end production capacity and is making steady breakthroughs in high-end capacity, leaving ample room for further advancement in domestic substitution.

Guosen Securities notes that the current industry landscape resembles the MLCC supercycle of 2018. However, the 2018 upswing featured across-the-board price hikes fueled by demand from consumer electronics and cryptocurrency mining rigs, alongside Japanese manufacturers voluntarily exiting mid-to-low-end production segments.

By contrast, the current market boom stems from surging AI demand. Supply tightness this time arises from major component giants shifting capacity to high-end products, which crowds out production allocated to consumer-grade components. This cycle delivers far higher demand certainty and steeper technical barriers; manufacturers that master high-end technologies will reap full benefits.