Weekly Global Update for October 8, 2015

September PMI Leading Indicators

Markit Economics just released its September country and regional purchasing managers’ indices:

• The global PMI declined 0.1 points to 50.6 in September. It was still in expansion territory (PMI>50) - but not by much (Chart 1).
• Chart 2 summarizes the August and September PMIs for some "electronics important" countries/regions.
• For the USA both the ISM (Institute of Supply Management) and Markit Economics PMIs reached recent low levels (Chart 3).
• Eurozone’s PMI dropped slightly (Chart 4). Chart 5 details the August versus September PMIs by major European country.
• China’s PMI plunged to its lowest level since the "financial crisis" of 2008 (Chart 6). Chart 7 lists the Asian PMIs.

Note: The China "flash" PMI compiled by Markit Economics and sponsored by Caixin Media is being discontinued. China has two manufacturing PMIs, one from Markit/Caixin, and the other published by the statistics agency of the Chinese government. The "official" version typically shows a stronger reading. Markit will continue to publish it China PMI at the first-of-each-month but not its "flash" version – which was released about 10 days earlier.

U.S. August Factory Orders Report

The U.S. Department of Commerce just released its detailed August shipments, orders and inventories,

• Electronic equipment orders remained above shipments (Chart 8) but order growth has dropped to near zero (Chart 9).
• Electromedical, measurement and control equipment remains by far the largest domestic electronic equipment sector (Chart 10).
• The ratio of electronic equipment inventories/orders declined (Chart 11).
• Vehicle shipments remained strong (Chart 12).
• Military electronics orders and shipments were little changed from August to September (Chart 13).
• Electromedical, measurement and control equipment orders and shipments reached an all-time high (Chart 14).
• Passive component orders and shipments appear to have peaked in this current business cycle (Chart 15). 3/12 Growth rates have also peaked – but at strangely high levels (Chart 16).
• The U.S. PMI leading indicator points to a rapid decline in passive component orders (Chart 17).

Source: www.census.gov/manufacturing/m3/index.html

Currency Exchange Rates

The trade-weighted exchange value of the U.S. dollar is at its highest level since 2002 (Chart 18). Here are historical exchange rates versus the U.S. dollar for some key currencies.

• Canada dollar (Chart 19)
• Mexico peso (Chart 20)
• Euro (Chart 21)
• Japan yen (Chart 22)
• China yuan (Chart 23)
• Taiwan NT dollar (Chart 24)
• South Korean won (Chart 25)

Source: http://research.stlouisfed.org

World PCB Production $60.2 Billion in 2014 (Chart 26)

The world market for printed circuit boards reached an estimated $60.2 billion in value in 2014, growing just 0.7% in real terms, according to IPC's World PCB Production Report for the Year 2014. Production growth in China, Thailand and Vietnam compensated for declining PCB production in most other regions. Developed by a team of the world's leading PCB industry analysts, the annual study is the definitive source of PCB production data, indicating the volumes and types of PCBs being made in the world's major producing countries.

The IPC report contains estimates of 2014 PCB production value by nine product categories and by 30 countries or sub-regions. Four categories of rigid PCBs, three categories of flexible circuits, and IC substrates are covered. The standard multilayer rigid PCB values are further segmented by those having microvia structures and those with non-microvia structures. The report also includes updates on metal-core PCBs, as well as regional trends and historical data on regional shifts in PCB production.

The data show that the worldwide rigid PCB market grew modestly in 2014, while flexible circuit growth was flat. Regional trends are also examined, including China's slowing production growth and the spectacular growth in the PCB industries of Thailand and Vietnam.

"PCB production is an international business and the landscape continues to change," says Sharon Starr, IPC director of market research. "Companies based in Taiwan, Japan and South Korea, are responsible for more than two-thirds of world PCB production. These and other companies around the world are powering the impressive growth of PCB production in southeast Asia."

The team of industry analysts that produced the consensus estimates and contributed content for the report include: Dr. Hayao Nakahara, NTI; Michael Gasch, Data4PCB; Mark Hutton, BPA Consulting; Francesca Stern, Francesca Stern Consulting; and Phil Plonski, Prismark Partners.

World PCB Production Report for the Year 2014 is available to IPC members for $475 and non-members for $950. For more information visit www.ipc.org/IndustryData or contact Sharon Starr, at +1 847-597-2817 or SharonStarr@ipc.org.

Source: www.ipc.org

World’s Largest PCB Producers

Thanks to our colleague Dr. Hayao Nakahara Charts 27 and 28 list the top 50 global PCB makers ranked by production value in 2014.

Source: Source: NT Information Services

North American Printed Circuit Board Shipments increased 1.5% y/y and Booking grew 24.1% in August 2015 (Charts 29 to 31)

IPC announced the August findings from its monthly North American Printed Circuit Board (PCB) Statistical Program. Year-over-year sales and order growth continued in August and the book-to-bill ratio climbed to 1.13, its highest level in more than five years.

Total North American PCB shipments increased 1.5% in August 2015 compared to August 2014. Year-to-date shipment growth stood at -0.1, reflecting the negative sales growth rates seen earlier this year. Compared to the previous month, PCB shipments were up 3.6%.

PCB bookings grew 24.1% compared to August 2014, increasing year-to-date order growth to 6.2%. Orders were up 11.3% in August compared to the previous month.

"Growth in North American PCB sales and orders continued in August and orders were especially strong," said Sharon Starr, IPC’s director of market research. "The book-to-bill ratio reached its highest level since May 2010," she added, "which is a strong indicator of positive sales growth in the fourth quarter of this year and into next year."

www.ipc.org

Drone and Robotics Technologies for Transmission and Distribution Expected to Reach $4.1 Billion in Annual Revenues by 2024

Improved safety and reliability create a strong value proposition for unmanned aerial vehicles and robotics technologies among transmission and distribution utilities, report finds

A Navigant Research report examines the market for drone and robotics technologies for transmission and distribution (DRTD), providing an analysis of market issues and global forecasts for revenue, segmented by region and technology, through 2024.

Unmanned aerial vehicles (UAVs, or drones) and other robotic technologies are rapidly finding purpose in a variety of commercial applications, including transmission and distribution (T&D). Operators and utilities around the world are now looking to these solutions to reduce costs, improve safety, and increase reliability and response times for their systems. According to a new report from Navigant Research, global annual DRTD revenue is expected to grow from $131.7 million in 2015 to $4.1 billion in 2024.

"For many years, T&D utilities in all regions of the world have been performing line inspections and maintenance, storm damage assessments, and vegetation management using traditional line crews and helicopters," says James McCray, senior research analyst with Navigant Research. "The use of drones and robotics for T&D inspection and maintenance not only represents a rapidly growing revenue stream for technology and outsourced services providers, but it could also help keep crews safer."

Working on high- and medium-voltage T&D systems comes with significant hazard, and the line worker’s job is considered among the top 10 most dangerous occupations in the United States, according to the report. Though the DRTD market is still in its early stages, with new developments and product releases occurring daily, the value proposition for T&D utilities to complete at least a portion of inspections, maintenance, and damage assessments via UAVs and robotics is strong.

www.navigantresearch.com

Global Electronic Chemicals Market to grow from $41 billion in 2013 to $63 billion by 2020

Widening Application Scope to Augment Global Electronic Chemicals Market

Electronic Chemicals Market (Wafers, Gases, CMP, Wet Chemicals, Photoresists and Others) for Semiconductors and IC, PCB and Other Applications – Global Industry Analysis, Size, Share, Growth, Trends and Forecast, 2014 - 2020

The global electronic chemicals market is characterized by rapidly changing technology and innovation. In fact, innovation plays a very pivotal role in determining the success of this industry. Electronic chemicals are the basic raw materials used extensively in the areas of telecommunication, information technology, and, very importantly, in flat panel displays.

There is a direct impact of the price, supply, and even the quality of electronic chemicals on the degree of competition witnessed by most downstream electronics industries. Electronic chemicals play a vital role in meeting the requirements of product specifications. The entry barrier in the global electronic chemicals market is rather high because of the rapidly changing technological background and the long time taken for evaluating the entire process of performance validation.

Growing at a CAGR of 6.2% from 2014 to 2020, the global electronic chemicals market is expected to reach US$62.92 billion by 2020 from US$41.02 billion in 2013. It is, however, expected that widespread implementation of environmental regulations will hamper the growth of the global electronic chemicals market in the years to come.

Source: http://www.transparencymarketresearch.com/electronic-chemical.html

Metal Prices

Here are updated metal prices:

• Copper (Chart 32)
• Tin (Chart 33)
• Silver (Chart 34)
• Gold (Chart 35)

Sources shown on charts