The Japan earthquake and resulting tsunami has had an absolutely devastating effect on the lives of thousands of the country's residents. Thousands of civilian lives have been destroyed and many businesses will not have to shut down due to damage. Despite happening thousands of miles away, the tsunami has also had an effect on businesses half way around the world.
The natural disaster will drastically affect the supply of electronic parts and hike the prices of key technology components. With Japan being a market leader in component manufacturing, this will send shock-waves throughout companies who rely on these parts. A large number of factories belonging to component, electronics and automobile manufacturers have been shut down following the natural disaster. Damage to key infrastructure like power, roads and transport will take weeks before it is fixed.
Short supply and rising prices of components such as NAND flash memory, dynamic random access memory (DRAM), microcontrollers and LCD parts and materials should all be anticipated.
Japan is also the world's largest supplier of silicon used to make semiconductor chips. The country generates 60 per cent of the global total and, luckily, the majority of manufacturing facilities are towards the south of the country thus missing the full damage caused by the quake and tsunami. However, a research group predicts that shipments of NAND from Toshiba's central Japan plant could drop by up to 20 per cent.
Luckily, the global supply of components and parts has a two-week excess inventory which will be able to deal with current conductor demand. But, once the excess parts run out, companies will likely find that there is a price hike or shortage towards the start of April. Companies wishing to purchase electronic parts and businesses who sell these products are recommended to purchase whichever materials you need right now before the shortage caused by Japan's worst earthquake in 100 years.
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