Japan’s problems may cause supply chain turmoil

The disasters in Japan, terrible as they are on the human side, will also have a significant impact on the electronics industry. Analysts in a range of industries are examining potential issues throughout the supply chain.

The two Japanese companies that supply around 70 percent of the worldwide supply of copper-clad laminate (CCL) used to make printed circuit boards have stropped production according to IHS iSuppli. If Mitsubishi Gas Chemical Company Inc. and Hitachi Kasei Polymer Co. Ltd. resume production as soon as expected, iSuppli believes that the existing supply of finished PCBs and raw CCL material is enough to keep electronics production lines running. But if there are delays, not an unlikely scenario with brownouts and other potential problems, prices could rise and shortages may occur.

DisplaySearch cited a number of materials and components used in displays and televisions, ranging from dye materials and exposure equipment for fabs, that could be in short supply in coming months. Though most flat panel suppliers have a few weeks inventory, some slowdowns or stoppages could surpass that. DisplaySearch also noted that the connectors used for the power and graphics signals in LCD modules made by Hirose and JAE may be in short supply due to the earthquake.

Elsewhere, IHS iSuppli predicts that Japan’s huge role as a supplier of silicon wafers may alter supplies and costs for all sorts of semiconductors. Manufacturing operations have stopped at Shin-Etsu Chemical Co. Ltd.’s and MEMC Electronic Materials Inc. The two shuttered facilities account for 25 percent of the global supply of silicon wafers.

If Japanese suppliers manage to get things back up and running, it will be nothing short of amazing. If not, it’s going to ripple through the supply chain for a while, forcing corporations to devise strategies that help them avoid problems.

IPC will hold a charity raffle on-site at IPC APEX EXPO with all proceeds going to the Japanese Red Cross. For the grand prize, IPC will donate a $2,000 American Express gift card.

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