As the market for consumers electronics continues to grow, there is one problematic question that faces the industry – can supply keep up with demand? More specifically, there are a number of “rare earth” minerals that are crucial in creating electrical components for an array of consumer electronics that include the iPhone and iPad but also more generally in LCD TVs and laptops, but have been very hard to locate in large quantities.
The concern about supplying such rare earth minerals may be quelled, however, with Japanese scientists discovering huge deposits of these rare earth minerals on the floor of the Pacific Ocean around Hawaii. more promising is that the deposits are of a heavy concentration with just “one square kilometer (0.4sq miles) of deposits [from the region] able to serve one-fifth of the current global consumption”. The discovery was made by a team from the University of Tokyo, led by Yasuhiro Kato, an associate professor of earth science.
He estimated rare earths contained in the deposits amounted to 80bn to 100bn tonnes – compared to global reserves currently confirmed by the US Geological Survey of just 110m tonnes that have been found mainly in China, Russia and other former Soviet Union countries, and the US.
The news has been met with positivity by consumer electronics companies and has seen a boost in share prices of non-Chinese mining companies that specialise in rare earth mineral mining. It comes after consumer electronics companies last year faced uncertainty when China last year slashed rare earth exports. The move, primarily in trade of the minerals of tantalum and yttrium, was frowned upon because China currently produces 97% of the global supply.
Sony said at the time that the move was a hindrance to free trade. Japan, which accounts for a third of global demand, has been stung badly, and has been looking to diversify its supply sources, particularly of heavy rare earths such as dysprosium used in magnets.
[Via The Guardian]
A report from DigiTimes today claims that Apple’s supply chain for its MacBook products will begin to “run in full gear” from early July as Apple prepares to a launch an updated MacBook Air. The report is in line with previous suggestions that Apple will wait until late July to launch a refreshed MacBook Air to coincide with the launch of Lion – which DigiTimes itself corroborates in the report.
[Increasing orders for components] is in line with Apple’s previous strategy to ramp up deliveries prior to the launch of new products.
The report does also mention that Apple expects to take “deliveries of over eight million MacBook Airs in the third quarter”. However, as MacRumors has pointed out, that figure is extremely large and actually represents double the amount of all Macs sold in the second quarter.
With several Japanese manufacturers struggling to bring their facilities back into operation after the earthquake and tsunami, Digitimes reports Apple is willing to pay more to have a constant, steady flow of touch panel supply for the coming months. After the release of the iPad 2 and with several reports about Apple facing issues with low tablet shipments from Asian manufacturers, the rumor is interesting as it suggests Apple is re-considering the amount of money that goes into pre-production deals with companies in China and Taiwan.
In order to secure sufficient supply of touch panels used in the iPad and iPhone, Apple has talked with Taiwan-based makers, considering some room for them to hike quotes, according to these makers.
With Apple’s capacity, It is a reasonable strategy from Apple to allow suppliers to hike quotes, and it will be a great help to the overall supply chain, even just for the short term, but will increase pressure to other vendors for tablet PCs and smartphone, touch panel makers believed.
In the past week many publications reported the Japanese earthquake might have not affected the stream of supplies necessary for the iPad 2 production. Apple is clearly looking ahead though, with an iPhone 5 set to debut this summer and likely ready to go into mass-production in a few weeks. Digitimes claims Apple is taking 60% of the current touch panel market, and a deal to pay manufacturers more to ensure availability may spell bad news for competitors like Samsung or Motorola, both heavily betting on Android-based tablets for 2011. [via MacRumors]
At Apple’s financial report yesterday there was an interesting revelation by Tim Cook that Apple had recently begun entering agreements with suppliers of key components. The agreement is presumed to be around $3.9 billion dollars and would secure the key strategic resources used in Apple’s products going into the future and there are suggestions it’s for high resolution displays.
As to what components are being secured, Cook didn’t elaborate but did say the deals were similar in nature to the flash memory deals of late 2005. That deal, and subsequent deals around flash memory secured supply for many of Apple’s portable devices including the iPhone and more recently the iPad.