In Shenzhen’s Huaqiangbei electronics market, the multilayer ceramic capacitor (MLCC) segment is experiencing divergent price trends, with consumer-grade components undergoing a significant correction while AI server-grade MLCCs maintain elevated levels.

After peaking two months ago, spot prices for consumer MLCCs have dropped by around two-thirds, according to Wang Jun, manager at Tongxin Chuanghui Technology, a distributor of imported MLCCs including products from Murata Manufacturing and Samsung Electro-Mechanics. Wang noted that the earlier surge in consumer MLCC prices was driven largely by speculative buying rather than underlying demand from downstream sectors. Despite the recent fall, prices remain somewhat higher than pre-rally levels. A modest recovery has followed reports that Murata plans to discontinue certain consumer-oriented MLCC models, suggesting stabilization for mainstream consumer products. Wang added that the broader consumer MLCC market appears saturated, with domestic manufacturers having ramped up production aggressively to meet demand.

In marked contrast, demand for server-grade MLCCs, particularly those used in AI data centres, remains robust and supply tight in Huaqiangbei. A separate distributor trading components from Murata, TDK, and Taiyo Yuden reported prices for high-capacitance MLCCs used in AI servers have increased as much as fivefold over the past year. Chinese state media recently cited vendors noting some models have surged to as much as ten times their original prices since the rally began in June. These gains are attributed to the rapid expansion in AI infrastructure, where server MLCCs require advanced specifications such as smaller size, ultra-high capacitance, and long-term reliability, differentiating them from consumer-grade parts.

While spot market prices for consumer MLCCs have decreased, contract prices set by key manufacturers continue to rise. For example, a report by TrendForce in August indicated Samsung Electro-Mechanics planned a 25 to 30 percent price increase for consumer-grade products aimed at reducing orders and reallocating capacity toward higher-end production. Industry shifts reflect a broader trend as major MLCC producers reallocate resources from mature, lower-margin product lines toward AI-driven demand. Murata, the world’s largest MLCC manufacturer, reportedly intends to cease production of selected models used in general-purpose and automotive applications, according to Taiwanese reports.

This strategic shift is creating opportunities for Chinese MLCC manufacturers, who currently lag behind Japanese and Korean firms in the highest-end segments but are making gains in the mid-to-upper tier range by leveraging advantages such as local materials sourcing, proximity to electronics manufacturers, and cost efficiency. Kazunori Ito, director at Morningstar, observed that as Japanese and Korean suppliers prioritize top-tier products, Chinese vendors could expand their foothold in standard and mid-tier MLCC markets.

Chinese companies are also making progress toward competing in AI server-grade MLCCs. Wei, a manager at Lanbaike Electronics, a distributor in Shenzhen, said domestic MLCCs for AI applications are still in trial phases but expressed confidence that significant technological advancements are imminent.

Overall, the MLCC market in Shenzhen reflects a bifurcated landscape shaped by varying demand dynamics: cooling consumer segment prices amid speculative retreat, contrasted by sustained price strength and supply shortages in AI server-grade components driven by the continued growth of data centre infrastructure.