Due to the current pandemic, there are many price increases . In this case, we are seeing disruptions in the various global productions , in particular that of hardware .
Indeed, semiconductors are strongly impacted with products that become rare and expensive when they are available.
The price of rare metals increases disproportionately and exerts an influence on the cost of hardware, which continues to soar .
We explain the why and how through the figures and analyzes of the sector.
Pandemic disrupts global production
Global production is strongly impacted by the pandemic . Many parts and multiple products are now unavailable or at far too high prices.
One of the main reasons for this price increase, due to slowing global production, is the current trade war between the USA and China . The latter therefore influences the supply and shipment of raw materials or components essential to the production and manufacture of products, in particular electronics.
In short, a pandemic that is disrupting our global economy , now controlled by the two powers of China and the United States.
In 1 year, supply shortages have multiplied regardless of the sector. Indeed, all electronic and electrical components are a rare commodity these days and have a strong impact on our economy.
A direct impact on the pc hardware
This pandemic, which is disrupting global production, is causing a sharp increase in the cost of rare metals with components that are no longer available or only at aberrant prices.
The consequence for us consumers : an exponential increase in hardware prices with less purchasing power. Indeed, the price of rare metals explodes and influences the price of electronics which increases in tandem.
According to Nikkei which is part of the semiconductor industry, the availability of natural resources is at a very critical point . We now understand why in the space of a year we have seen inflation never seen before .
Here are the factors that played into this:
- the weakening of supply chains due to the pandemic
- exploding demand
- economic and political tensions between China and the United States, two of the largest producers of rare earth metals.
And all this therefore results in increased prices , including motherboards, graphics cards and therefore all electronic products and hardware.
As proof, the terbium oxide which is present in LEDs , fuel cells or flat screens records a tariff inflation of 60%. The same goes for aluminum, which has increased by 55% and which is leading to an increase in the price of enclosures. In short, parts and components which are more and more expensive and which influence the consumer prices of hardware.
Graphics cards already affected by cryptocurrency
Graphics cards are affected by cryptocurrency, with more than 700,000 graphics cards already used for mining (first half of 2021 figures). With the increase in people interested in mining, due to its return on investment, the market value of graphics cards (in total) that are in the hands of miners is around $500 million , and this figure is not about to drop.
The high-end graphics cards that miners love today are, indeed, an excellent solution to mine quickly and win quickly , much to the dismay of gamers.
Up to 150% increase on rare metals
As seen earlier in this article, the increase in electronics prices is driven by the increase in the price of rare metals . Indeed, between 2020 and 2021 there is an increase of up to 150% for certain metals . Just that and it's not about to stop!
For example, praseodymium and neodymium , two rare metals, recorded an increase of more than 74% . Lithium suffered a 150% inflation in one year and tin, meanwhile, recorded an inflation of 82%. When we know that tin is used in all solders, we better understand the increase in prices for electronic cards in particular.
China controls 55% of production
55% of world production of rare metals is controlled by China and 85% of refining. With the implementation of more drastic controls on the shipment of its raw materials, China plays an important role in this inflation of the prices of rare metals.
Some countries are therefore beginning to think more seriously about local production in order to stop this dependence on China, but this is easier said than done in a world where China and the United States control a global economy through their decisions. customs and economics.
In short, a pandemic that only increases the supremacy of China and makes the entire world population dependent on supplies and shipments from this country.