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Technology Stocks : Applied Materials No-Politics Thread (AMAT) -- Ignore unavailable to you. Want to Upgrade?

To: etchmeister who wrote (19252)	6/5/2006 2:52:33 PM
From: Proud_Infidel	Read Replies (1) \| Respond to of 25522

Is anything going our way????? Copper prices spike as shortage looms Jennifer Baljko My-ESM (06/01/2006 9:00 AM EDT) Prices for copper soared in early May, leaving many wondering what impact the unstable commodities markets might have on longer-term supply of that metal and other critical materials. By May 10, copper prices on the London Metal Exchange, a major metal market, hit a whopping $8,148 per metric ton for spot-market cash buys, up 79.5 percent from $4,537 per metric ton at the beginning of January. Prices for three-month contracts, with copper delivery slated for July, climbed to $8,005 per metric ton, up 82 percent from $4,397 per metric ton on Jan. 3. On the Comex division of the New York Mercantile Exchange, prices reached $3.923 a pound on May 11, up 81 percent from $2.168 per pound at the beginning of the year. Copper, valued for its ability to conduct electricity, is becoming more frequently used in semiconductor packaging and lead-frame materials, especially for advanced submicron technologies. The international Copper Study Group (Lisbon, Portugal) said Chilean mine production fell sharply earlier this year, while mine closures and labor strikes further constrained supply and drove prices upward. Other increases Though it may be too soon to tell how the market fluctuations will affect semiconductor purchasing practices, industry observers are closely watching the skyrocketing prices of copper and other metals used in semiconductor production. Prices have also spiked for gold, for example. "Copper appears to be one more commodity where higher prices could be impacting semiconductor materials pricing," said Dan Tracy, senior director of industry research and statistics at Semiconductor Equipment and Materials International (SEMI; San Jose, Calif.). "Other examples include oil prices, which impact the price of chemicals and resins used in semiconductor manufacturing and packaging, and gold pricing, which impacts the price of gold wire used in semiconductor packaging." Although Tracy said lead-frame suppliers — those likely to be most affected by the increase — usually have contract clauses that adjust the lead-frame pricing as copper commodity pricing fluctuates, he expects suppliers and customers will look for ways to improve materials and manufacturing process efficiencies. "There is a possibility, [in] some device applications, that a smaller and thinner lead-frame design can be used" that requires less copper, he said. Semiconductor companies including Advanced Micro Devices, Freescale and IBM declined to comment on the price changes in the commodities market and the potential effects on purchasing and supply chain practices. — Jennifer Baljko