No Sign of Recovery in Semiconductor Production Until First Half of 2023

Published  April 7, 2022   0
S Staff
Semiconductor- Shortage

The worldwide sales of these items reached  a value of $50.7 billion, which showcases a 26.8 percent YoY Growth

According to the researchers from Semiconductor Industry Association (SIA), the international sales of semiconductors escalated from YoY in January 2022 and this happened in spite of the ongoing global crisis of semiconductor production. According to the association, the worldwide sales of these items reached  a value of $50.7 billion, which showcases a 26.8 percent YoY augmentation. But, when compared to December 2021, the total in January reduced to 0.2 percent.

While the worldwide sales of chips began surging from January onwards, the ongoing shortage in production of the chips is impacting the global automotive sales and the car makers clearly opined that the current semiconductor supply chain imbalance is a huge challenge to recover and cannot be tackled this year also. In the meantime, Deloitte also published a report that says the current semiconductor crisis cannot be countered even at the end of this year. Deloitte’s spokesperson told the media, “Deloitte Global predicts that many types of chips will still be in short supply throughout 2022, and with some component lead times pushing into 2023, meaning that the shortage will have lasted 24 months before it recedes, similar to the duration of the 2008–2009 chip shortage.”

While scrutinizing deep into the slump in production of semiconductors back in December 2021, Deloitte also added that the lengthiness of the chip shortage boils down to one overarching factor: A significant surge in demand, driven by digital transformation and accelerated by the pandemic. And consumer devices aren’t the only thing, or even the main thing, driving this demand. Every mechanical product in industry is becoming increasingly digital, and every vertical sector is becoming ever more reliant on digitization.”

Amidst the current Russia’s Invasion of Ukraine Apart, the prices of Palladium also reduced to $2,165 per troy ounce last week. In a media interaction, MetalMiner co-founder Stuart Burns said, "Renault closed its Moscow plant because of a lack of parts,” Burns wrote. “Many manufacturers have voluntarily closed plants in Russia, including Toyota, Mercedes-Benz, Hyundai, Ford and BMW. Cross-border trade in car parts is rapidly drying up. At some stage, automakers in western Europe could also be hit by a lack of palladium supply.  Russia produces some 40% of global supply. South Africa is the next largest producer. However, South Africa does not have the ability to ramp up to cover the shortfall.