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Why there is a rise in PCB Board raw materials price?

Posted:02:15 PM February 24, 2021 writer: NextPCB

Our raw material prices increasing?

The prices of raw materials such as copper foil, resin, and acetone continue to rise, which is transmitted downstream of the industry chain. Copper-clad laminate companies have also increased the frequency of price increases. The copper-clad laminate giant Kingboard laminate has issued three price adjustment letters within a month. Market participants pointed out that this is the fifth round of price increases this year.

Since China has become the biggest manufacturer of PCB boards in the world, it requires a constant supply of PCB raw materials. It is vice versa. For instance, if PCB raw material suppliers increase the price, it will bring an impact on the final product. So this price-increasing trend won’t stop in the electronics industry.

PCB raw materials trend

Raw material prices rise, copper-clad laminate giants raise prices

As explained in the price adjustment letter, the increase in raw material prices is the main reason for the continuous price adjustment of copper-clad laminates during the year. The main raw materials of copper-clad laminates are raw copper, glass cloth, and epoxy resin. Recently, the main Shanghai copper contract on the Shanghai Futures Exchange opened its weekly K-line for five consecutive gains, setting a new high in more than seven years. According to data from the business agency, the production price of East China liquid epoxy resin (E-5L) has risen by 65.58% in the past three months.

 

Demand picks up, downstream HDI boards are in short supply

In addition to the increase in raw material prices, the price increase in the copper-clad laminate market is also supported by the rebound in downstream demand.

Copper-clad laminate is the core substrate for PCB manufacturing and accounts for the highest cost of PCB raw materials.

What are the reasons behind the recent rise in PCB raw material industry?

New Era Securities believes that 5G and automotive electronics drive the copper-clad laminate industry to a high-frequency and high-speed evolution. 5G brings a new round of upgrades to base stations and consumer electronics, which further spurs the increase in the consumption of high-frequency and high-speed copper-clad laminates, enabling the industry to achieve both volume and price increases.

 At the same time, the electronification of automobiles is deeply evolving due to the development of intelligent driving and new energy power, driving the demand for high-frequency and high-speed copper-clad laminates upstream.

Related concept stock combing

2021 is still at the peak of 5G construction, a lot of PCB manufacturers believes that the PCB industry will begin to pick up in the third quarter of 2020, and the kinetic energy of the early-stage driving sector has shifted from communication base station products to consumer electronics, home appliances, and automotive electronics products. It is expected that the PCB sector will continue the trend of downstream recovery in 2021.

First of all, from the perspective of copper foil, the price of copper foil is mainly composed of copper price and processing costs. The price of copper foil depends on the price change of copper and is relatively affected by international copper prices.

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What is the second wave of PCB raw materials price increasing?

Following the price adjustment in January 2021, the copper-clad laminate industry recently ushered in the second wave of price increases during the year.

Many PCB raw material suppliers collectively issued notices of price increases. The price increase notice of Kingboard shows that due to the all-around rise in copper prices, oil prices, and transportation costs.

 

PCB raw materials price increasing

 

What is copper-clad laminate?

Copper Clad Laminate (CCL), the full name of Copper Clad Laminate (CopperCladLaminate), is the basic material for making printed circuit boards (PCB). It has developed simultaneously with the electronic information industry, especially the PCB industry. 

 

Conclusion

The upstream of the copper-clad laminate industry chain is mainly raw materials such as fiberglass cloth, copper foil, and epoxy resin. It seems that there are a number of reasons, but one of the biggest reasons behind this rice hike of PCB raw materials is post covid era.

In many countries, now the situation is getting better, and hopefully, prices will be normal in a couple of months.

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