Prices of metals like copper, lithium and aluminum rise, and electronics could get even more expensive

According to reports, many rare earth metals and some other elemental metals for the manufacture of electronic materials such as copper are experiencing a sharp rise in price. Copper, for example, increased by 37% and tin by 82%, which represents a general increase in the cost of manufacturing PCBs since copper is used for all its layers and tin is used to solder electronic components to the PCB, and also the cost of manufacturing all cables will also have a strong increase thanks to this increase in the cost of copper.

The material with the greatest increase is undoubtedly lithium, which is now worth 150% more than what it cost last year. What’s more, other fundamental materials are increasing along with itsuch as neodymium and praseodymium, which have risen 74% in one year, which will increase the cost of multiple products, from speakers to electric cars to turbines.

Another increase that will significantly affect production costs is that of terbium oxide, which is used to manufacture LEDs, among other things, which has seen an increase of more than 60%. Even aluminum is up 55%, which means an increase in practically everything with a lightweight metallic structure, or even in heatsinks that use this material for a large part of your body.

According to reports, China controls 55% of rare metal extraction and 85% of refining processes. The Chinese government has been putting tighter export controls this year, and it could be a way to combat trade disputes it has with the US by limiting supply to its companies. Even so, it would be affecting the whole world, since China is practically the distribution center for these products.

At the moment, many negotiations are taking place to maintain prices around the world, and although for now some companies are absorbing these increases in their costs, sooner or later they will be reflected in the sale price to consumers. For example, the dedicated audio company Sonos has already been increasing the price of its speakers as components increased, and this could be the case for many other companies in the not too distant future if these increases continue.

The outlook is not good for electronics and without a doubt the pandemic and the lack of semiconductors are playing a key role in all this. The lack of stock of many products and all the indicators that the situation will not improve signal an alert for the industry. We will see if the negotiations manage to mitigate the increases a bit, and we hope that the situation improves as soon as possible.

What do you think about these increases in the metals used to make electronic components? How much do you think users will be transferred?

Source: TechPowerUp