PCB News - 5G drives PCB volume and price rise

PCB, as a key component of electronic products, is used in almost all electronic products. It is a key interconnection for assembling electronic parts. It not only provides electrical connections for electronic components, but also carries electronic equipment digital and analog signal transmission, power supply and For business functions such as radio frequency and microwave signal transmission and reception, most electronic equipment and products need to be equipped, so it is called the "mother of electronic products."

The PCB industry is the industry with the largest output value in the global electronic component industry. With the deepening of research and development and the continuous upgrading of technology, PCB products are gradually developing in the direction of high density, small aperture, large capacity, and lightness.

PCB, as the basic material for the upstream of electronic circuits, changes due to changes in the demand for downstream electronic products. Since the outbreak of the financial crisis in 2008, the global economy has been weak, and electronic consumption has also been impacted. In 2009, the output value of PCB decreased by 15%. After the compensatory recovery in 2010, the innovation of electronic products encountered bottlenecks and the growth was weak. After reaching the bottom in 2016 Demand ushered in a rebound in 2017.

As the cornerstone of electronic products, PCB is widely used. According to Prismark data, in 2019, wired communication infrastructure, wireless communication infrastructure, servers, mobile phones, and PCs accounted for 57% of the total output value of the entire PCB industry.

According to Prismark, the global PCB output value in 2019 was approximately US$63.7 billion, a year-on-year increase of 2.1%. It is estimated that the global PCB output value will reach 74.756 billion US dollars in 2023. The global PCB industry market is still expanding, and the market prospects are considerable.

With the continuous increase of labor costs in countries and regions such as Europe, the United States and Japan, and the shift of downstream consumer electronics manufacturing to mainland China, mainland China has become the world's largest and fastest-growing PCB manufacturing base. In 2019, China's PCB output value is about 33.744 billion U.S. dollars. According to forecasts, China's PCB output value will reach 40.556 billion U.S. dollars by 2023, accounting for 54.25%. China's PCB market is developing rapidly, and the growth rate exceeds the growth rate of the global industry.

PCB is a collection of systems carried by each electronic product. The core substrate is copper clad laminate. The upstream raw materials mainly include copper foil, glass fiber and synthetic resin. From the cost point of view, copper clad laminates account for about 30%-40% of the entire PCB manufacturing. Copper foil is the most important raw material for manufacturing copper clad laminates, and the cost accounts for 30% (thin plates) and 50% (thick plates) of copper clad laminates.

In 2019, the new domestic electrolytic copper foil production capacity will be 129,000 tons, and the total production capacity will reach 593,000 tons. Among them, PCB copper foil production capacity increased by 31,000 tons, with a total production capacity of 333,000 tons; lithium battery copper foil production capacity increased by 98,000 tons, with a total production capacity of 260,000 tons. From the perspective of new projects, the increase in the production capacity of high-frequency and high-speed PCB copper foil for 5G construction is not significant. Driven by the market size of nearly 10 billion required during the 5G base station construction period, the construction of domestic production capacity and the speed of domestic substitution will still need to be improved .

There are many types of PCB products, which can be classified according to the number of conductive layers, bending toughness, assembly methods, substrates, and special functions of the products. However, in practice, they are often classified as mixed according to the output value of each sub-industry of PCB as: Single panel, double panel, multilayer board, HDI board, package carrier board, flexible board, rigid-flex board and special board.

Flexible boards are widely used, and downstream end products mainly include high-end consumer electronics such as smart phones, tablet computers, PC computers and wearable devices. As electronic products continue to shift to light, thin, small, and multi-functional, the market share of FPC continues to rise. Among them, mobile phones account for about 33% of the total FPC market share. Benefiting from the development of 5G communications and the intelligentization of consumer electronics, the FPC market is expected to further expand.

Multilayer boards can be divided into low- and middle-layer boards and high-level boards according to the number of layers. Low- and mid-layer boards generally refer to printed circuit boards with 4-6 layers of conductive patterns, which are mainly used in consumer electronics, personal computers, notebooks, automotive electronics and other fields. The high-level board refers to a printed circuit board with 8 layers or more of conductive patterns, which can be used in communication equipment, high-end servers, industrial control medical, military and other fields.

At present, the multi-layer board market is still dominated by low- and medium-layer boards (63%), but according to Prismark's forecast, the growth rate of the output value of high-level boards in the future will be higher than that of low- and mid-layer boards, and the compound annual growth rate in 2018-2023 will reach 5.0%.

The global PCB industry market share is relatively scattered. In the global PCB market in 2018, the market share of No. 1 Pengding was only 6%, which is almost the same as the market share of companies such as Schindler, Tripod, Samsung Electro-Mechanics, etc., which ranked second, third, and fourth.

According to Prismark data, the annual compound growth rate of the world's top 20 PCB manufacturers from 2011 to 2018 was 5.7% (the global PCB market growth rate was 2.4% during the same period), and the total market share in 2018 increased from 38% in 2010 to 48%, The market concentration is gradually increasing. Among the top 40 PCB companies by global revenue in 2018, according to Prismark's statistics, there are 6 Chinese companies.

The PCB products produced in my country are mainly low-end products such as single and double panels, multi-layer boards below 8 layers and low-end HDI boards. Low-layer boards accounted for 33.31% of the total output value; rigid double-sided boards accounted for 11.57% of the total output value; HDI boards accounted for 16.63% of the total output value, accounting for 59% of the global HDI board output value, but according to the attribution statistics, China's HDI board output value only accounts for 17 of the global output value

With the high value of high-frequency and high-speed PCBs, the boom cycle brought by the construction of 5G base stations, and relatively high technical barriers, the performance of related industry chain companies has brought about rapid growth. 2020 will be the first year of large-scale and heavy-duty base station construction. . With the adjustment of the industrial structure and the increase in the concentration of production capacity, the production technology of China's leading PCB companies will also be further improved, and the possibility of achieving domestic substitution in the domestic high-end product market will also be further increased. In the future, with the emergence of new needs such as automotive electronics, data centers, and artificial intelligence, the PCB industry will usher in new growth points.