PCB News - Price adjustment of PCB material CCL

CCL price "retaliatory" adjustment due to excessive squeeze

Under the new normal of the economy, many industries and enterprises in transition are facing multiple difficulties and struggle to survive. However, since the end of 2015, there has been a continuous supply shortage and price peaks in one industry. This is the basic material of the PCB electronics industry copper clad laminate.

Yesterday, the elites of China's copper clad laminate industry gathered in Quanzhou to hold a high-level forum on the bank of Wurong Park in Nan'an to analyze the current situation and discuss the future together.

Supply-side reforms lead to lack of supply, prices continue to rise for three years

What mysterious force is causing this industry to rise against the trend?

"This is a market-driven supply-side reform." As the world's second-largest professional CCL manufacturer and the first domestic CCL listed company, Liu Shufeng, chairman of Guangdong Shengyi Technology Co., Ltd., analyzed that the electronics industry is nearly a dozen. Almost the only industry in the world economy that has been growing in 1991, the copper clad laminate industry has also been investing in expansion, but certain links in the supply chain cannot benefit from this growth. Unreasonable prices for a long time have contributed to the supply-side Reforms have caused a lack of supply, leading to "retaliatory adjustments" in prices.

According to analysis, the price of copper clad laminates has been at a low level for a long time, and reached the most extreme around 2015. As early as 2012, as a major country in the electronics industry, Japan gradually reduced its production of copper clad laminate products, and companies switched to producing electrolytic copper foil for flexible boards and copper foil for high-frequency materials with higher added value. In addition, companies from Japan, South Korea, China, and Taiwan are switching to foils for lithium batteries. Due to the combined effect of many factors, the supply of one of the main copper clad laminate products has decreased by 31%, and the world's copper clad laminate industry is undersupply as a result.

However, the copper clad laminate industry has huge investment and is a capital-intensive industry. The lack of supply due to insufficient production capacity has not triggered new investment actions. On the contrary, the copper foil industry is the first time in history that a new market for power foil has appeared. In the future, the copper foil industry may no longer rely on the electronics industry or may seek a way out of part of its production capacity. Almost all of the copper foil manufacturers' investment plans as of 2018 will be in power foils.

"All parties in the supply chain are a community of destiny, not a simple relationship between buying and selling." Liu Shufeng said that the supply-side reform of the copper foil industry has also brought common reflection and warning to other industries. In today's professional division of labor and internationalization, each link of the entire supply chain is also each link of the value chain, and they are mutually dependent.

In addition to price, there is also the reconstruction of the value chain brought about by technological progress in various links. One link cannot be regarded as a traditional buying and selling relationship. Everyone is related to fate. Excessive squeezing of suppliers and a loss at one end will make the supply imbalance, and the price adjustment after the imbalance is "retaliatory", so it is very necessary to maintain a reasonable price. According to analysis, the current situation will continue until 2018.

Copper clad laminates seem remote and unpopular, but they are actually closely related to our lives." Fu Zhixiong, general manager of Fujian Lihao Electronics Co., Ltd. said that copper clad laminates are the upstream companies of circuit boards, including home appliances, mobile phones, computers, automobiles, mobile wearable devices, Medical equipment needs to use the downstream product circuit boards of copper clad laminates. Once the copper clad laminates have problems, the circuit boards will have problems. "The copper clad laminates of 5 yuan and 10 yuan have problems. The product cannot be used."

Fu Zhixiong said that although competition in this industry is fierce, it is difficult to enter. There is only one CCL company in Fujian Province, Lihao Electronics, and the company's paper-based CCL market share ranks among the top three in the country. Fu Zhixiong said that the price of copper clad laminates is not expensive, but the quality and stability requirements are extremely high. On the one hand, the company has selected a supplier and will not be easily replaced for the stability of the product. On the other hand, the quality and technical requirements of the supplier will be Very strict.

Fu Zhixiong is full of expectations for the "Quanzhou Core Valley" currently under construction. Chip Valley's demand for electronic materials will be relatively strong. As a local company that provides basic materials for electronic equipment, it is willing to carry out targeted development for companies that come to "Quanzhou Chip Valley" and cooperate with downstream electronics companies.

For the future of the industry, Zhu Datong, a senior consultant of the Copper Clad Laminate Materials Branch of the China Electronic Materials Industry Association, believes that with the new development of automotive electronics, it is predicted that there will be a printed circuit board market demand of US$9 billion by 2020. In the next few years, China will gradually enter the 5G era, and a large number of communication base stations will be built. This is bound to detonate greater demand for circuit boards, and thus become a new hot spot in the copper clad laminate market. However, the new hot market has also put forward higher performance requirements for copper clad laminates, and the industry must work closely with the upstream raw material industry to meet challenges.

Leng Daguang, secretary general of the Electronic Copper Foil Branch of the China Electronic Materials Industry Association, also said that changes in market demand have allowed copper foil companies to realize normal production and operation capital circulation, and companies can gather more funds for technological innovation and specialize in production technology. It is also more obvious that China's copper foil should transform and develop into medium and high-grade copper foil varieties to further improve its international status and market share.

At the forum, more than 200 industry elites from more than 60 copper clad laminate industries across the country and relevant persons in charge of the copper clad laminate materials branch of the China Electronics PCB Material Industry Association also discussed the development status of the circuit board industry and the development of China's electronic copper foil under the new situation. Wait for discussion.