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ELECTRONIC/SEMICONDUCTOR SECTOR NEWS (OCTOBER - DECEMBER 2007)

Exports in August Rebound, Aided by Electronics Sector

For the first time in three months, Malaysia's exports which have been soft due to weaker demand for electrical and electronic products (E&E), expanded in August. Exports grew a marginal 0.3 per cent year-on-year, above market expectations and a Business Times poll which had forecast a contraction of 0.43 per cent for the month. The International Trade and Industry Ministry (MITI), in releasing the data yesterday, attributed the growth to a 10.9 per cent increase in the E&E products from July. Imports with a value of RM44.61 billion increased by 2.9 per cent from a year ago in August while a trade surplus of RM8.99 billion was recorded for the month.

Bank Islam senior economist Azrul Azwar Ahmad Tajudin said that "while E&E exports are likely to remain lacklustre in the next couple of months, we could perhaps see more discernable signs of an E&E recovery. "By end of the third quarter, these manufacturers will begin gearing up for an expected pick-up in demand driven by year-end festive season and back-to-school sales," he added. A 4.9 per cent year-on-year rise in global sales of semiconductors in August could offer a glimmer of hope for a turnaround in global electronics demand.

HSBC Bank economist Prakriti Sofat said electronics exports which have remained on the backfoot, have gone through the seventh consecutive month of decline. "We continue to see solid growth in palm oil exports which have been growing at an average rate of 32 per cent year-on-year since the start of the year – with world prices of palm oil being very favourable," she added. She also observed that exports to the US have contracted for the sixth consecutive month while those to the European Union have slowed for the fourth straight month as compared to those to China which have jumped by 16.3 per cent year-on-year.

MITI said Asean, the US, the EU, China, Japan, Hong Kong and the Middle East were the top export markets which accounted for more than 80 per cent of the total exports in August. "The outlook for exports excluding electronics remain very positive, though for electronics still a little cloudy. However as the global inventory overhang works its way off we should see some improvement," said Prakriti. On tech exports from Malaysia, Citi director for Asia Pacific and market analysis Dr Chua Hak Bin noted that tech exports have been underperforming in Malaysia relative to Singapore, South Korea and Taiwan. "Our tech leading electronic indicators suggest tech demand will remain lacklustre in the coming months in the run-up to Christmas," he said.

(Source: New Straits Times, 5 October 2007)

 

Intel to Widen Lead as Chip Maker

Intel Corp will widen its lead as the world's largest maker of semiconductors this year, while Japan's Toshiba Corp is poised to overtake Texas Instruments Inc as the third-largest producer, research firm Gartner Inc said. Intel will generate 12.2 per cent of global semiconductor revenue in 2007, compared with 11.6 per cent last year, the Stamford, Connecticut-based researcher said last Friday in an e-mailed statement. Toshiba will jump three slots in the rankings after posting the fastest sales growth among the world's 10 largest producers, it said.

Intel processors that run computers and Toshiba flash memory chips that store songs in Apple Inc iPod media players will help industry sales rise 2.9 per cent this year, Gartner said. Toshiba's market share will rise to 4.6 per cent in 2007 after revenue climbs by 28 per cent, helped by sales of NAND flash memory and image sensors used in mobile phones, Gartner said. Samsung Electronics Co's market share will probably remain at 7.7 per cent as the second-largest producer, it said.

(Source: New Straits Times, 17 December 2007)