The tantalum capacitor market will post single-digit growth this year as demand stays healthy while prices are stable to down depending on case size of the capacitor.

Capacitor manufacturers say prices have been very stable for parts in A and B cases with downward movement for larger D and E case sizes. Pricing has continued to drop as the market sees increased competition from higher capacitance multilayer ceramic chip (MLCC) parts. "Pricing is dropping every year. Only pricing for small case sizes and higher capacitance parts remain stable," says Jim Wright, vice president of technology and marketing for NIC Components Corp. in Melville, N.Y.

Leadtimes also differ among suppliers. Dan Lane, tantalum marketing manager, for AVX Corp. in Myrtle Beach, S.C. reports tight capacity for some parts, which has resulted in extended lead times. Delivery for some devices has stretched from 10 weeks to 19 weeks over the past eight months for select devices. AVX says it's in the process of increasing capacity for its low-profile devices, where it sees the biggest demand, which will help reduce lead times.

In contrast, Wright says there is "no tight supply and there seems to be plenty of capacity." Delivery for NIC's smaller case size parts is six to eight weeks and eight to 10 weeks for larger case sizes.

One thing that tantalum capacitor suppliers agree on is that the biggest demand is coming from Asia, particularly from China. "What goes on in China overpowers everything else," says Lane.

The global market is strong with unit sales nearly reaching 2000 levels of 6 billion units, Lane says. "Asia is driving growth in the high-volume business," says Wright. Demand for small case sizes and low-profile tantalum capacitors are driven by ultra-small handheld portable products being designed and manufactured in Asia, he says.

Lane agrees that the biggest demand is coming from the handheld device market that requires lower profile components. "Everybody is pushing for lower profile. Most of our product is driven toward low-profile devices down to 1.0 and 1.2-mm in height. That seems to be the key driver right now, but we're seeing quite a bit activity from other markets including automotive and military, which are strong."

Still, only certain tantalum capacitor segments, such as small case sizes and high capacitance/low equivalent series resistance (ESR) as more multilayer ceramic capacitors (MLCC) are being designed into equipment and are taking a greater share of the overall capacitor market, says Wright.

The question for manufacturers is whether to accept it or focus on niche markets, he says. NIC has made the decision to focus on performance passives, where the performance of the component is key to the circuit design. To support this strategy, the company announced about a year ago its Quick Kit custom kit program that allows a customer to choose sample parts for free. Over 600 part numbers are available in the program and kits ship within 48 hours. It's also available through its distribution network.