Higher Ruthenium Prices Extend Lead Time for Resistors

(Source: Sergey Ryzhov/Shutterstock.com)

Published June 4, 2021

Mouser Electronics Technical Content Team | Estimated reading time: 2 minutes, 12 seconds.

Thick film chip resistors are all around us. Crack open an electronic component and you'll find them.

These ultra-small packages of ceramic, glass, ruthenium, and silver are used in the trillions on printed circuit boards that require specific ohmic values to operate. These resistors are used in almost every electronic circuit in the world.

You'll find thick film chip resistors in wireless handsets, computer motherboards, computer hard drives, monitors, automotive electronic subassemblies, televisions, stereo amplifiers and industrial electronics.

Now, we're learning that these tiny items are getting more expensive. Entering the second quarter of 2021, resistor manufacturers are facing price increases in key feedstock metal ruthenium.

Of all electronic components, only ceramic chip capacitors are on par with thick film chip resistors in terms of the sheer volume of parts produced and consumed.

These massive economies of scale, low price and concentration of manufacturing place thick film chip resistors among the most challenging electronic components to produce.

Also, chip resistor production in the U.S. and Europe is almost non-existent, especially for thick film chips, because of the low costs and return on investment.  Small quantities of thick film chip resistors are manufactured for Western consumption in Israel, but the majority of thick film chips are produced in China and Japan, with minor additional production factories in Malaysia, Thailand, South Korea, and the Philippines.

The risky nature of thick film chip resistors is their reliance upon ruthenium in their resistive pastes (Ru02). Ruthenium is a by-product of platinum mining in South Africa. Platinum mining has been plagued by workers’ strikes, which impacts the volume of metal above ground and, subsequently, the price, which increased to $330 (USD) per troy ounce (31.1 grams) in February and $400 per troy ounce in March 2021. At the start of 2021, ruthenium was at $270 per troy ounce.

Thick film chip resistors represent what is termed a rendered economy, defined as a product economy where other manufacturers do not wish to compete because of hurdles regarding return on investment/profitability, technology and/or massive economies of scale.

Resistors represent more than 90 percent of the global consumption volume for ruthenium metal, which makes the metal sensitive to any changes in the global high-tech economy.

Unprecedented increases in the price of ruthenium has resulted in extended lead times for the ubiquitous resistor component. Because of the large percentage of variable costs in the production of chip resistors relying on raw materials, those along the supply chain should expect price increases and short supply for the rest of CY 2021 and FY 2022.

This article contains information from TTI and the Mouser Electronics technical content team.