The high demand for equipment and installation materials, as a result of the return to normality after the pandemic, has left an uncertain outlook for manufacturers and suppliers in the sector, as the supply begins to decline, prices increase, and all as a result of the shortage of raw materials. A shortage of raw materials, semiconductors, electronic components, etc., which affects the entire value chain, from manufacturers to distribution, installers, as well as developers, maintenance and reform companies, etc.
The lack of electronic components, copper, steel, plastics, etc. It has already caused the partial stoppage of production of several automobile manufacturers, and is beginning to put stress on other auxiliary industries or manufacturers of original machinery -OEM-, by not having all the necessary elements to manufacture.
And the forecasts are not very positive, transferring the tension of the entire supply chain until the year 2022. A problem on a global scale that is already one of the great concerns of the sector. According to data from the Spanish Association of Cable, Electrical Conduit and Fiber Optic Manufacturers, FACEL, the price of PVC has already increased by 20%, copper by 18.5% and aluminum by 15.4%, in the first quarter of 2021.
The origin of all the problem is in the US and its economic incentive policies, and China, where the Asian giant already foresees a 7.5% growth of its economy, being also the largest consumer of raw materials, chips and semiconductors in the world. world. The large stockpiling that they have made of these components has generated shortages in the rest of the countries, and prices have risen since mid-2020. Fortunately, the Chinese government has recently decided to release its strategic reserves of copper, aluminum and zinc to deflate prices to world level. Although the collapse of seaports in Asia is also problematic, where delays in container shipments accumulate, and growing demand has tripled the cost compared to 2020.
The emergence of green technologies, such as the electric vehicle and its infrastructure, also has its influence. The demand forecasts for this green mobility will increase from 2 to 8 million in 2025. The impulse towards this electric mobility and the growing production of these vehicles, also stresses the availability of chips and metals such as copper, silver, platinum, which are vital raw materials for these sustainable vehicles.
Demand for semiconductors and chips will not stop growing
To all this is added teleworking, and the digitization of everything that surrounds us. This new trend as a result of the pandemic has catapulted the demand for consumer electronics, computers and all kinds of devices that facilitate work from home.
What started as a momentary mismatch between supply and demand has turned into a perfect storm, where demand is unstoppable, growing, the forecast was wrong, in contrast to a highly concentrated chip and semiconductor manufacturing industry (83% of the world production is concentrated in Taiwan and South Korea), as is that of metals. There are those who claim that chips have become as scarce and coveted as gold, unable to keep up with demand.
The demand for chips will not stop growing in the present and in the future. The reason? More and more products incorporate a chip. And with the arrival of 5G and the connectivity imposed by digitization, it will be a structural trend. Thermostats, light bulbs, cars, bicycles, refrigerators, etc … everything that surrounds us is / will be backed by an integrated circuit.
