Supply Crunch Alert! AI Boom Sparks Shortages and Price Hikes in High-End PCB Materials

The supply-demand imbalance triggered by surging AI demand has spread to the upstream of the printed circuit board (PCB) supply chain. High-end raw materials such as copper-clad laminates (CCL), electronic copper foil, and electronic glass fabric are facing shortages, further driving up prices. Notably, capacity expansion struggles to keep pace with market demand.

An executive from a listed company noted that high-end products are consuming capacity rapidly due to AI's explosive growth, while short-term supply remains constrained. Upstream price volatility and tight supply are pressuring downstream costs. Companies like (002938.SZ) and Shenzhen Fastprint Circuit Tech (002815.SZ) are mitigating impacts through technological upgrades and product optimization.

Industry sources highlight that while low-end PCB products remain available, AI-related materials are in short supply. The ripple effect is evident across the upstream supply chain. AI-driven demand has revitalized PCB industry sentiment, boosting orders for high-end substrates and triggering widespread shortages and price increases.

CCL, a core PCB material, relies on electronic copper foil and glass fiber cloth. Suppliers adopting a "copper price + processing fee" pricing model report rising fees amid strong demand. Recent industry forums indicate rebounding copper foil demand, with major producers operating at full capacity and processing fees gradually increasing.

"The industry's key challenge is 'low-end oversupply versus high-end scarcity'," said Ding Yu, head of research at Nuode Investment (600110.SH). Competition will center on technological barriers and global capabilities, with less advanced players facing consolidation. Nuode is transitioning to premium products like HVLP, RTF, and alloy foils, though technical hurdles persist in achieving optimal roughness and corrosion resistance.

Electronic glass fiber cloth producer (603256.SH) reported a 17-fold net profit surge to 139 million yuan in Q1-Q3, driven by robust high-performance fabric demand. Prices for standard 7628 fabric rose to 4.2-4.4 yuan/meter in September, up 0.1 yuan from early 2025 levels, as production shifted toward premium segments.

Honghe Tech's ultra-thin fabrics command six times standard product prices, with next-gen low-dielectric and low-CTE variants seeing further increases due to scarcity. Chairman Mao Jiaming anticipates sustained demand growth from cloud computing, autonomous vehicles, AI, and advanced packaging.

High-end CCL markets also face supply constraints, with multiple price adjustments this year. Industry experts attribute this to rapid adoption in AI servers, automotive electronics, and 5G/6G applications, compounded by complex material formulations and lengthy certification processes. Frost & Sullivan's Xie Shuqin notes thin copper foil and specialty glass fabric bottlenecks exacerbate shortages.

Honghe Tech expects gradual capacity expansion for next-gen products through 2026, while Nuode predicts the copper foil crunch may persist until Q3 2026, with domestic alternatives emerging later. Technical challenges include precision titanium rollers and post-processing techniques.

Downstream PCB makers report mixed impacts. Fastprint acknowledges CCL price pressures but cites mitigation through design optimization and selective price adjustments. emphasizes stable supply chains and premium product development to offset costs, forecasting steady Q4 demand from both consumer electronics and AI servers.

Prismark projects global PCB output to reach $95 billion by 2029, growing at 5.2% CAGR, supported by AI and high-performance computing trends. Market watchers continue monitoring high-end material supply dynamics.