Converge Freight and Compliance Alerts.
Effective January 26, 2010, all ocean freight to the U.S. will require a security filing known as ISF, or the 10+2 rule. This rule is nicknamed 10+2 because carriers are required to file 12 additional pieces of data with U.S. Customs; 10 of these elements are provided by the importer/consignee and 2 by the carrier. Failure to accurately file the ISF will result in penalties up to the value of the cargo, and freight will not be loaded, causing delivery delays. The fine for failing to update, withdrawing or submitting incomplete filings will be $5,000.
The ISF is filed with U.S. Customs electronically and is required to be filed 24 hours prior to vessel loading. This means the days are gone when freight can be loaded immediately, with a commercial invoice to follow at a later time. Most importers will utilize the services of their import brokers to perform this task but can also self-file.
The information filed will be used to help the U.S. better assess and identify high-risk shipments. Customs’ automated targeting system will analyze the data and flag appropriate containers for further review as they approach the U.S.
The importer is now required to provide its forwarder, prior to vessel loading, the following 10 data elements:
1. Seller name and address
2. Buyer name and address
3. Ship to name and address
4. Manufacturer/supplier name and address
5. Container loading location
6. Consolidator name and address
7. Importer of record number or Foreign Trade Zone applicant ID number
8. Consignee number(s)
9. Country of origin
10. Commodity HTSUS number (minimum 6-digit level required, 10 accepted)
The carrier (steamship line) is required to file its vessel stow plan and container status messages 24 hours prior to arrival in the U.S. These filings are for freight imported to the U.S. as well as freight transshipping to other regions, such as South America.
These filings can be done directly by the importer, or with a power of attorney, the importer’s freight forwarder can do the filing. The importer must also have a continuous bond on file or file a single-entry bond when filing. All entries into the U.S. are audited by Converge to ensure accurate and timely filings.
December 16, 2009
Converge Freight and Compliance Alerts.
Posted by Converge at 3:46 PM
Converge LCD Update.
One of the biggest news items in the panel industry is the recent merger of CMO and Innolux. Innolux is part of the Foxconn Group, which is known in the electronics industry for its rapid growth and aggressive pricing strategies. The merger allows Foxconn to better integrate its supply chain, thus being better positioned to compete with industry leaders from mobile phones to notebooks and LCD TVs. Converge believes there is little doubt that Foxconn will surge ahead as a leader in the manufacturing of these applications in the coming years.
Despite the overall downtrend, TV panel pricing is showing signs of stability in December, and the pricing outlook for January 2010 is expected to remain largely unchanged. The strong seasonal demand from Asia before the Chinese New Year provides support at the current pricing level. Factory pricing for 32", a benchmark regarded by many market observers, remains around $200, with lead times stretching out to 4 to 6 weeks. Most factories are fully booked through the end of January. TV and desktop panels are both manufactured in the sixth-generation line. With more production capacities being allocated to TV, desktop panel supplies will inevitably be affected and are starting to show signs of shortage.
Downsized production capacities and strong seasonal demands in China conspired to push the prices higher for monitor panels. In addition to making 26", 32", and 37" TV panels, the sixth-generation line also supplies mother glass for mainstream desktop panels. Pricing for desktop monitor panels is expected to increase 5% to 10% between now and January 2010. Several sizes in the highest demand are 18.5" through 22.0". The factory lead time has also increased from 2 to 3 weeks quoted in September through October to 4 to 6 weeks at the current level. With the holiday seasons approaching around the globe, panel supplies are getting tighter.
LCD supplies for notebook PCs remain modestly allocated. Going into 2010, most of the 15.4" and 17" models featuring CCFL illuminators are completely discontinued, replaced by LED technologies. This is one of the technological advancements that revolutionize the entire industry. On the flip side, this may represent one of the toughest challenges that the service industries have had to face in a decade, in fulfilling their repair contracts as the shortages on the CCFL technology become permanent.
The industrial panel market shows little change, with demand resurfacing on certain EOL models such as the Sharp LQ084, LQ104, and LQ121 series.
Posted by Converge at 3:44 PM
Converge Storage Update.
Widespread shortages in the 3.5" storage market continue. This is especially true in the 500GB through 1.5TB SATA capacities, and specifically in the 1TB drives, across all manufacturers. The aforementioned drives are being allocated through distribution. Currently, when available in the open market, 500GB is selling at $55 to $60, 1TB at $89 to $92, and 1.5TB at $117 to $122 into the manufacturing space. These prices are reflective of non-enterprise-level HDDs. We expect this shortage to continue at least until the midway point of Q1 CY2010, with shortages in the 500GB and 1.5TB increasing to the levels that we are currently seeing with the 1TB capacity. Meanwhile, the lower-capacity SATA HDDs have not reached the shortage levels of the higher-capacity drives. As a result, pricing is relatively unchanged month over month. However, we are seeing volume demand on a price point variance (PPV) basis. The IDE capacities have been relatively unaffected by the SATA shortage. Demand remains steady for the 80GB through 400GB range, with pricing stable.
Most of the activity in the 2.5" SATA market is in support of end-of-life HDDs needed for service. We are not seeing shortages near the level of the 3.5" market, thus most production inquiries are for PPV savings. Demand remains strong, with routine volume purchase inquiries for the 160GB through 500GB SATA capacities. Meanwhile, demand is increasing for the 2.5" IDE interface. This is evident in the 80GB through 250GB HDDs. We believe that the shift of mainstream production to the SATA interface coupled with an overall slowdown in production during late 2008 and early 2009 are primarily responsible for this. Looking forward, we expect this trend to continue, with increasing demand and shrinking supply for this interface in the capacities previously noted.
Posted by Converge at 3:42 PM
Texas Instruments (TI) Data Converters (TPS) Logic series (SN74) and OP Amps (OPA) still the hottest parts in the market
Converge Semiconductors and Integrated Circuits Update.
Shortages and extended lead times trouble the market.
The market is settling into a consistent pattern of spot shortages and extended lead times, being driven by the following:
- Texas Instruments (TI) Data Converters (TPS) Logic series (SN74) and OP Amps (OPA) are still some of the hottest parts in the market right now, with lead times extending 18-20 weeks on most products. National Semi appears to be the best option on competing lines, with lead times remaining at 8-12 weeks. However, On Semi and ST Micro are both facing allocations on some of their competing lines, which may further impact lead times.
- Lead times on Altera PLDs have stabilized at 8-16 weeks.
- TI and Freescale DSPs are still short, with Freescale lead times out to 14-16 weeks and some of the TI products out as far as 28 weeks. There looks to be no loosening of this supply well into 2010.
- MCU lead times are extending across all manufacturers, with widespread allocation a possibility. TI’s MSP430 line is experiencing lead times over 22 weeks while Atmel, Infineon, and Freescale are pushing 20 weeks.
- On Semi MBR(S) diodes have hit lead times up to 24 weeks, and prices on some parts have risen dramatically.
- There are strong indications that the significant increase in demand we have been tracking over the last quarter will continue at least into the second quarter of 2010. Allocations on some products will likely occur, and customers need to be very attentive toward any rescheduled delivery dates from manufacturers.
Posted by Converge at 3:39 PM
Converge CPU Update.
In November, the CPU market saw an increase in demand for new builds coming from PC production ramping. This development bodes well as we are tracking many encouraging signs in the market as the end of the year approaches.
A closer look at the embedded processor market.
Converge’s pedigree in IC and CPU computer production products means that we have a unique vantage point in tracking product movement in the embedded processor market. For example, Intel Atom processors move freely from the active netbook market to industrial computing, as do bundled chipsets.
This is a very dynamic market, and we have observed components move freely between the two market segments. For example, E6400 desktop and T7400 notebook CPUs are primarily coming from the embedded sector to fill end-of-life demand in the consumer PC market. The open market has become the ideal tool for rebalancing supply and demand inefficiencies, and the embedded/consumer crossover is becoming an area of consistent growth.
The mobile Calpella family waits in the wings.
As widely expected, many of the Calpella parts, Intel’s next-generation PC platform, were delayed for the holiday season. Converge anticipates that the new mobile chips will arrive with much fanfare in the New Year. We’ll provide future updates to keep you up to date on any potential shortages and savings that this switch will bring.
Additionally, the new Bloomfield, Lynnfield, and Clarkdale desktop families are creeping into the open market. Converge is tracking the i7-920s and i5-750s, which are currently attracting shortage demand.
Pockets of AMD desktop parts sit in excess.
We have been tracking a glut of excess, particularly in the AMD x2 215, which can be found in the spot market in large volumes. Market demand for these parts has been tepid. In addition, Converge has been tracking a number of Phenoms and Opterons in large OEM excess. The difficulty of using many revisions of a particular part makes it less fluid in the open market.
Posted by Converge at 3:37 PM
Converge Memory Update.
For the first time in over eight months we are starting to see some softness in the DRAM market. The DDR3 market remains stable, but the DDR2 market is showing some signs of weakness. In both SO-DIMM and desktop, 2GB PC800 DDR2 has dropped from the low-to-mid-$50s range to high $40s in a two-week span. This is the first time since March that we have seen a price decline in 2GB DDR2. This decline in the spot market price seems to support why the DRAM manufacturers were unable to negotiate any further price increases in the contract market for the past two contracts. The tier one PC manufacturers are reporting that they have been receiving supplies of DDR2 from their direct channels over the last two weeks. With the upcoming holidays at the end of the month, it's not uncommon to see the memory market soften as we work our way through December.
Converge believes that the memory spot market price for DDR2 will continue to drop slightly between now and the beginning of January. However, we believe that the drop will be minimal and not anything drastic. With the spot market having been 20%-40% above contract for several months now, we are looking for the DDR2 market to drop to or slightly above contract for both 1GB and 2GB PC800.
The DDR3 market should remain stable throughout the remainder of the month. Demand for DDR3 is still strong, and Converge believes it will continue to increase as we head into the New Year.
Posted by Converge at 3:34 PM