Lead Time and Price Update: Raw Material Supply Challenges

We would like to inform you about the current challenges surrounding raw materials for producing electronic components, such as cables and connectors, and the related impacts on lead times and pricing.

Plastics

At the end of 2020, we began receiving signals from several manufacturers indicating that the situation was becoming critical across many areas. Large quantities of essential base materials for plastics were either not delivered or allocated elsewhere. The technical plastics segment, in particular, is currently causing severe disruptions in the supply chain, resulting in extended lead times.

Due to the limited availability of approved plastics for these connectivity products, some brands we carry are currently only able to maintain limited production, and in some cases, production has ceased entirely. Unfortunately, as Lumberg Nederland, we have no control over the manufacturers' ability to deliver.

Copper

In addition to these supply issues with plastics, we’ve seen a 30% increase in copper prices over the past two months, beginning in early 2021. This trend largely depends on growth within relevant industrial sectors, their demand, and supply capabilities from the mining industry. The price of gold has also risen sharply in recent months.

Combinations of Factors

This combination of circumstances is leading to rising prices for electromechanical components and further delivery challenges. Some manufacturers have already indicated that delays and, in certain cases, cancellations may occur for these products.

In the coming period, we will continue to keep you updated on developments in this situation. We will explore all possible avenues to help navigate these market conditions together. We, too, have been unpleasantly surprised by this explosive rise in prices and lead times. Wherever possible, we are happy to work with you to find solutions and, where feasible, identify alternatives. If you have any questions in response to this article, please don’t hesitate to contact us.