Buyers can expect prices for commodity multilayer ceramic capacitors (MLCC) to fall by as much as 5% for the year, although leadtimes will stretch for some high-capacitance ceramic capacitors. Prices for specialty devices will remain stable.

Leadtimes are extended for high-capacitance parts because only a few capacitor manufacturers, including Murata and Vishay, have the capability to produce the parts. As a result there have been shortages for 1 microfarad and above ceramic capacitors and leadtimes have stretched to 16 weeks.

But overall, capacitor manufacturers say capacity is adequate. "There is some price erosion on the commodity side, but stable for specialty devices," says David Valletta, senior vice president of global strategic sales for Vishay Intertechnology in Malvern, Pa. Prices for commodity parts will fall 3–5% for the year, according to some manufacturers.

Buyers can expect demand to rise for high-capacitance capacitors as the parts get designed into more cell phones and flat-screen televisions, says Mark Waugh, product manager for capacitors, at Murata Electronics N.A. in Smyrna, Ga. "With demand increasing, high-capacitance capacitors have been put into crunch mode," he says.

However, Murata expects leadtimes will eventually decline because of increased production capacity. Murata says it invested $400 million in production capacity expansion in fiscal year 2006 and expects to increase its 2007 investment by more than 10% over last year for both high-capacitance parts and 0402 case sizes. The bad news is that leadtimes may not shrink until next year.

While leadtimes have stretched for high capacitance parts, delivery times for commodity 0402 devices are running about eight weeks, depending on capacitance value, size and voltage. Leadtimes for standard specialty devices are also about eight weeks.

Overall demand for MLCCs continues to grow, says Valletta. "At a minimum the market will grow 5% this year with two notable areas of growth." Those areas include the high-capacitance/low-voltage business and the high-voltage market.

The high-capacitance/low-voltage market is driven by cell phones, laptop computers, digital cameras and gaming consoles. To serve those industries, capacitor manufacturers cram as much capacitance as possible into ever shrinking packages.

With the higher voltage market, the goal is getting more capacitance into a smaller package with higher voltage ratings. That market is driven by the requirements of telecommunications, automotive, medical and mil/aerospace sectors, says Valletta.

The one key distinction between the higher capacitance and higher voltage markets is case sizes. In the telecommunications and automotive markets, 1206, 1210 and 1812 case sizes at 100, 250, 500 or 1,000 volts or higher are used, Valletta explains.

Targeting high-voltage applications has been on Vishay's radar screen for several years. The company's most recent products target arc-over and cracking issues. Aimed at power and industrial applications, the HVArc Guard product prevents surface arc-over at high voltages with twice the voltage breakdown of standard capacitors, and the polymer termination, designated as code "B," provides more flexibility to the termination to reduce cracking typically caused by board flexure.

Murata also focuses on the high-capacitance/low-voltage and the high-voltage segments and is targeting the power supply market.

Waugh says Murata will provide higher capacitance values in smaller packages at voltages that are needed in the market place.

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