Shares of JLMAG (HKEX: 06680) rose close to 7% in trading. At the time of writing, the stock was up 6.37% to HK$20.18, with a turnover of HK$829.03 million.
Market Catalysts
According to industry data, spot and distributor prices for consumer-grade multilayer ceramic capacitors (MLCCs) have already increased by 20% to 40% from previous levels. A key development is that leading Japanese and Korean MLCC manufacturers, including Murata, Samsung Electro-Mechanics, and Taiyo Yuden, are operating at full capacity expansion. However, their high-purity dysprosium inventory is reportedly only sufficient for about one month of full production, triggering a global scramble for the material and intensifying expectations of a supply squeeze.
Analyst Outlook and Material Demand
Analysts project that investment in AI servers and related infrastructure will "continue to grow at least until 2028," providing clear medium-term growth visibility for passive components like MLCCs. Public information indicates that dysprosium oxide is a critical material required for manufacturing automotive-grade MLCCs, which must withstand high engine compartment temperatures, and for AI server MLCCs, which need to handle heat from high power consumption. High-end MLCCs must use high-purity dysprosium oxide with a purity level of 99.999% (5N).
Supply-Demand Imbalance Forecast
Research points out that the explosion in demand for high-capacitance AI MLCCs is driving a sharp increase in demand for high-purity dysprosium oxide, a material for which there is no mature substitute. It is estimated that by 2027, AI-MLCCs will create an additional demand for 1,500 tonnes of dysprosium oxide. This amount represents nearly 40% of the global total supply of approximately 3,500 tonnes, a shift expected to completely overturn the supply-demand balance for heavy rare earths and initiate a sustained price increase cycle.
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