The ‘rice of electronics’: how AI-driven demand for MLCCs triggered a supply bottleneck

AI-driven demand for multilayer ceramic capacitors (MLCCs) has triggered a supply bottleneck, with AI servers requiring up to 28,000 MLCCs per unit—a 13-fold increase from standard servers. The surge, described as 'scary' by Taiyo Yuden's CEO, is also fueled by rising demand from electric vehicles and humanoid robots, creating what Goldman Sachs calls the largest cycle in MLCC history.

The ‘rice of electronics’: how AI-driven demand for MLCCs triggered a supply bottleneck Power-hungry data centres fuel demand for MLCCs, which are crucial components for modern innovations including smartphones and electric cars Iris Deng /author/iris-deng in Shenzhen multilayer ceramic capacitors https://www.scmp.com/tech/article/3356652/japanese-and-korean-giants-move-upmarket-chinas-mlcc-firms-see-their-chance?module=inline&pgtype=article MLCCs are the smallest yet indispensable components powering modern innovations from smartphones to electric vehicles EVs . artificial intelligence AI https://www.scmp.com/tech/tech-trends/article/3356940/us-models-chinese-ai-learning-game-safety-tests-research-lab-says?module=inline&pgtype=article have caused an explosion in demand, a surge described as “scary” by Katsuya Sase, CEO of Japanese MLCC maker Taiyo Yuden. Here is what you need to know about what Goldman Sachs calls the “largest and longest” cycle in MLCC history. How has AI triggered a MLCC supply bottleneck? The massive build-out of power-hungry data centres to meet the computing needs of AI is the key driver of this cycle. Servers dedicated to AI training and inference require substantially more ultra-high-capacitance MLCCs to accommodate the sharp increase in power consumption. An AI server needs up to 28,000 MLCCs per unit, a 13-fold increase from a standard set-up, according to China Securities. Rubin architecture https://www.scmp.com/tech/big-tech/article/3338845/nvidia-ceo-huang-says-next-generation-chips-full-production?module=inline&pgtype=article?module=inline&pgtype=article , debuting later this year, uses 12,000 MLCC units on a single board, compared with 6,500 on the current GB200 platform, according to TrendForce. humanoid robots https://www.scmp.com/tech/article/3354371/commercial-humanoid-robots-china-may-soon-do-laundry-make-beds-care-elders?module=inline&pgtype=article , EVs and autonomous cars, is also on the rise. An EV with Level 2+ autonomous driving capabilities uses more than 10,000 MLCC units, according to Murata Manufacturing, the world’s largest MLCC maker. In comparison, around 800 to 1,000 MLCCs are needed in each smartphone.