AI Race Drives Sharp Increase in Server Component Prices

The unprecedented surge in demand for artificial intelligence (AI) and high-performance computing systems in the global technology market has begun to directly impact the prices of essential server components. Specifically, leading manufacturers of aluminum electrolytic capacitors, a critical part of server and power systems, have announced price hikes. This was reported by Ixbt.com news reports.

Japanese giants in this field — Nippon Chemi-Con and Nichicon — announced they would significantly raise their product prices. According to Ixbt.com, Nichicon, the world's second-largest supplier, has already notified its customers of price increases across all product lines. This situation is expected to trigger a new wave of price hikes across the entire electronics industry.

Main reasons for the price increase

Experts noted that while an initial increase of around 9–12% was expected, latest data suggests the growth could reach 10–15%. These changes will affect not only the cost of finished products but also the strategies of competing manufacturers in Taiwan and other regions, who are also expected to adjust prices in the coming months.

Several external factors are causing this sharp price rise. First, the raw materials market has deteriorated: chemical materials have become 30–40% more expensive than before, and metal raw materials have increased by an average of 10%. Additionally, the production costs for aluminum foil have risen significantly.

Geopolitical tensions in the Middle East and global inflation, coupled with rising electricity prices, have further pressured manufacturers. According to Nichicon representatives, limited production capacity combined with excessively high demand for servers left them with no choice but to revise prices.

Chain reaction in the industry

The rise in aluminum electrolytic capacitor prices is part of a chain reaction in the electronics industry. Similar growth was previously observed in the markets for multi-layer ceramic capacitors (MLCC) and tantalum capacitors. This increases the costs of building data processing centers (DPC) and cloud technology infrastructure.

These changes may also indirectly affect the Uzbekistan market. As digitalization processes accelerate and local server parks expand in our country, the rising cost of components is likely to impact the final price of network equipment. Taiwanese suppliers plan to transition to new pricing policies starting in June and July.

In conclusion, the development of AI technologies is fundamentally transforming not only the software market but also the hardware market. The instability of raw material prices and the sustained demand for high-tech equipment suggest that component prices may rise further in the near future.