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PCB raw material purchase price decline ,market demand is polarizing

With purchase price of PCB raw materials decreased the cost pressure eased

Base metal futures on the London Metal Exchange fell on fears of economic recession. Three-month copper fell 6.5 per cent for the week, its biggest weekly decline in a year. It closed at 8,322 dollars per ton, down 15 dollars or 0.18 percent from the previous day. Data analysts said copper prices were at risk of falling further, the economy was slowing sharply and a recession seemed inevitable. Copper prices are expected to fall towards production costs of $7, 000 – $7, 500 a tonne, but tight supply and rising demand for electrification will lift prices.

Copper clad

Many Chinese analysts believe demand will be key to determining the price movement of metals such as copper in the near term. The market is increasingly worried about the health of the global economy against the backdrop of unconfirmed short-term demand increases.

Copper-clad board

Copper-clad board is one of the main raw materials in circuit board manufacturing plants, which is greatly affected by the price of copper, oil and gold. As the supply shortage of upstream copper clad board manufacturers gradually eased, since February this year, the purchase unit price of copper clad board of many PCB enterprises has continued to decline, and the cost pressure has gradually eased. copper-clad plate

Epoxy resin

Last week, the decline in China’s raw material market intensified, including epichlorohydrin market continued to decline, the offer of bisphenol A also fell widely, raw material side support is lacking. In terms of supply and demand, the epoxy resin market is in abundant supply, while the recovery of downstream demand is slow. The market has price but no market, and the industry chain is depressed by negative factors, and the market falls again and again. As of June 24, the mainstream negotiation price of liquid resin market in East China is 22000-23000 RMB/ton, 1000 RMB/ton lower than last week; Huangshan area solid resin market mainstream negotiation price reference in 19500-20200 RMB/ton, compared with last week’s price down 1150 RMB/ton.

PCB downstream market demand polarization

Smart phone

In the first quarter of 2022, global smartphone shipments were only 314 million units, down 9.1% year on year. With the outbreak of the epidemic in 2022, local conflicts and continued inflation, the overall market demand for smart phones has also declined, and it is an indisputable fact that manufacturers have higher inventory rates. Global smartphone shipments are forecast to fall to 1.31 billion units in 2022, down 3.5 percent year-on-year, according to the latest report. Although many manufacturers blamed chip and supply chain strains when the mobile phone market declined in the second half of 2021, the overall decline for three consecutive quarters is not just a supply-side issue. Due to the influence of many unstable factors since the beginning of the year, the major mobile phone manufacturers have also appeared “reducing the order” situation. Xiaomi, OPPO and Vivo have reportedly told suppliers to cut orders by around 20%. Samsung and Apple have also revised down shipments of some models to some extent.

PC and tablet PC

In the first quarter of 2022, the total global PC market shipments were only 80.4 million units, down 4.3% year-on-year. The PC market fell for the first time in two years after booming growth. The impact of the pandemic led to increased demand for home office/entertainment, and as the pandemic receded, the global PC market demand gradually returned to normal.
In the overall PC market, both education and consumer demand slowed after the pandemic receded, while demand for commercial PCS remained strong. As a result, the PC market is no longer experiencing the high growth of the first two years, but it will still be higher than the pre-epidemic market level. Total tablet shipments in the first quarter of 2022 were only 38.3 million units, down 4% year-on-year. The tablet market, like PCS, both benefited from the demand pull of the pandemic and also suffered a post-pandemic downturn. Although many manufacturers have pointed to supply-side issues such as electronic components and chip shortages, there is no escaping the fact that tablets have entered a mature market. In addition, according to a research report by a Chinese institute, Facebook Meta’s meta-universe hardware and head display business is slowing down. Meta has cut its forecast for shipments of Meta Universe hardware by 40% in 2022. Meta has also suspended all new head-display /AR/MR hardware projects after 2024. The concept of the meta-universe, which was hyped at the beginning of the year, was a mess after the speculation. Now PCB industry giants are slashing shipments and even suspending mid – and long-term development plans.
Consumer electronics downstream demand is low, “lack of orders” has become a normal situation for many PCB manufacturers. Related industry in China said that PCB enterprises are facing greater operating pressure at present, some factories have begun to implement a two-day holiday due to the reduction of orders, and even some enterprises from May on two days off five, three days off four.
But at the same time, many manufacturers of high-end PCB products, such as HDI, automotive electronic board, and IC board, are relatively clear orders. Some industry insiders even revealed that the order visibility of ABF substrate suppliers extends to at least 2027 due to customers queuing to buy capacity.

Conclusion

On the one hand, the consumer electronics market as a whole showed a trend of decline, PCB downstream demand, on the other hand car electronic board, and a load board IC and other high-end PCB product demand, market demand for polarization tracks are becoming ever more obvious, under this big difference in order, PCB industry reshuffle process or will be further accelerated. PCB material

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