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Increasing Costs of Commodities Only a 2nd Order Effect on Electronics


There has recently been concern over the raising price of commodities (e.g.: copper, tin, silver, gold, cement, steel, oil, lumber, etc). So it is only natural to ask how it affects electronics. A recent SMT Magazine posting discusses this issue, mostly from an increased cost of metals perspective.

As an electronics consumer it is always disappointing when prices increase and it may be alarming to see double digit increases in some important electronics metals like tin, silver and copper. But we need to keep in perspective the actual likely increase in the cost of finished electronics products.

According to a recent article in PC Magazine, a PC weighing 7.9 pounds (3.6 kg) contains about 410 grams of copper, 29 grams of tin and 0.9 grams of silver (I made a conversion from leaded to lead-free solder.) At $14.4/kg for tin, $390/kg for silver and $8.20 per kg for copper, my laptop has a total of $4.14 worth of these metals, several years ago it might have been less than $2.00.

My laptop cost $1500, $4.14 is less than 0.3% of its cost. The reason for this small percentage is that electronics is the greatest value add industry in the world, raw materials costs are second order.

So it is fair to worry about all increases in cost, but even doubling of metals costs in electronics only slightly increases the finished product cost.


Dr. Ron