Motherboard vendors including Asustek Computer and Gigabyte Technology, in response to increases in the international price of copper and labor costs in China, are expected to hike their prices by about 10% as early as the end of the first quarter of 2012, according to industry sources.

Motherboard prices were hiked by 5-10% in early 2011 to reflect increased material costs and the impact of labor shortages, and by 3-8% in April 2011 due to increased costs of some components arising from the earthquake hitting northeastern Japan in March, the sources indicated.

Copper pricing has risen from less than US$8,000 per metric ton (MT) before the 2012 Lunar New Year to US$8,600/MT currently, causing hikes in the cost of CCLs (copper-clad laminates) and in turn production cost of motherboards, the sources noted.

As for labor costs in China, the minimum monthly wage in Beijing was hiked by 8.62% from CNY1,160 (US$184) to CNY1,260 on January 1, 2012. Shanghai will raise wages 14.28% from CNY1,120 to CNY1,280 on April 1, and Shenzhen raised wages 13.63% from CNY1,320 to CNY1,500 on February 1, the sources indicated.

Asustek and Gigabyte expect their motherboard shipments in the first quarter of 2012 to increase 10% and 20%, respectively, on quarter, the sources said.