Xu Zhiping
The price increase of smartphone accessories has become the norm this year. The main reason for the price increase is that the market supply exceeds market expectations, not only in major accessories such as processors and displays. In addition, such as copper foil , etc. are also in short supply. As a new material that is indispensable for many smart products such as smartphones, copper foil previously relied mainly on Japan due to limited domestic production capacity. This situation has gradually been broken with the release of production capacity in the domestic market. However, despite this, driven by the dual drive of smartphones and automobiles, the price of copper foil has almost continued to rise this year since March. According to market research structure predictions, by next year, the market demand for copper foil sheets will still not ease. This trend of shortages and price increases will continue to spread!
The price of copper foil has increased by more than 30% throughout the year. The performance of major manufacturers has been very good.
In March this year, Kingboard, the second largest domestic copper foil substrate manufacturer, took the lead in increasing prices and continues to this day. Copper foil sheets are still in short supply. Currently, lithium batteries are on the market. Copper foil sheets and standard copper foil sheets are already in a state of price but no market. Copper foil sheet manufacturers are very tight in supply, and there are even situations where customers bring cash to rush for goods.
So far, the price of lithium battery copper foil has soared to 78 yuan/kg, an increase of 6 yuan/kg. Industry manufacturers expect the price to rise to 80 yuan/kg by the end of this year, and the price of standard Huai type copper foil has also increased from 60 yuan /kg has soared to 76-78 yuan/kg, and the price increase has reached an average of 30%, and the price is still rising! According to copper foil substrate manufacturers, the quotations of upstream copper foil for copper foil substrates have continued to rise recently, and fiberglass yarn and cloth are also planning to follow suit. Jiantao, the Lu factory that previously had a large price cut on copper foil substrates, has also been quick to raise prices and has notified downstream Printed circuit board (PCB) customers’ prices increased by RMB 5, or nearly 5%.
According to copper foil factory Jinju Development, in addition to some industry peers closing factories and reducing production, in recent years with the development of electric vehicles in mainland China, some industries have shifted their production capacity to high-margin, unit-price lithium batteries, resulting in a sharp decline in the supply of PCB copper foil. Recent international copper prices It has stabilized again, and copper foil prices have continued to rise.
It is understood that Kingboard Chemical Group and Nanya, to which Kingboard Laminated Board belongs, are complete PCB industry chain groups. In addition to PCB, they also have upstream fiberglass yarn, cloth, copper foil, and copper foil substrates. Now Kingboard is the first to call for copper prices to rise. It is not known whether Nanya, which has a similar scale of foil substrate and copper foil substrate, will follow suit. However, according to Taiyao Technology, PCB products applied to Kingboard copper foil substrates are relatively low-end. Taiyao has mainly targeted the application of high-temperature copper foil substrates such as cloud servers in recent years. The amount of copper used is lower than that of PC products. However, if the Taiwan market South Asia, the leader, is shouting for gains and will follow suit. Nanya Electronic Materials Division emphasized that it has not yet discussed whether to follow up on the price increase of Kingboard copper foil substrates. The main reason is that the downstream PCB boom does not seem to be transparent.
In the process of market supply exceeding demand and price increases, the performance of many copper foil and related manufacturers has skyrocketed. Take Shengyi Technology as an example. As the leading domestic copper clad laminate company, its copper clad laminate business revenue accounts for 80% of the company's total revenue. The increase in copper foil prices has driven the price increase of copper foil substrates (copper foil substrates). With the long-term drive of automotive electronics/communication high-frequency boards and the breakthrough of new semiconductor substrate BT boards, its performance this year is very good.
Not long ago, the company announced its third quarter financial report. According to data, the company achieved operating income of 6.11 billion yuan from January to September 2016, a year-on-year increase of 8.85%. The average operating income growth rate of the semiconductor and component industry was 38.65%. The company’s operating income this quarter An increase of 10.63% from the previous quarter; the net profit attributable to shareholders of listed companies was 500 million yuan, a year-on-year increase of 47.87%, which was a major benefit to the company's stock price. The average net profit growth rate of the semiconductor and component industry was 32.43%. The company's net profit this quarter increased from the previous quarter. Quarterly growth of 12.63%.
In Taiwan, the major copper foil manufacturer Jinju Development has experienced a substantial increase in monthly revenue in the third quarter of this year. Starting from May this year, its monthly revenue has increased by more than 2% compared with the same period last year. percentage points, especially starting from June, basically every month’s revenue has exceeded 30% year-on-year! As of now, Jinju Development's revenue in the first 10 months of this year has reached NT$4.295 billion, a year-on-year increase of 21.64% compared to last year's NT$3.531 billion. This has prompted the stock price of Jinju Development to rise by more than NT$200 this year. %!
In addition, the increase in copper foil prices has directly led to the increase in copper foil prices for copper clad laminates. Taiwanese copper clad laminate manufacturers have seen an improvement in performance in the past six months, and stock prices have also begun to rebound. It is understood that copper foil accounts for as high as 40% of the cost of copper clad laminates. ——50%. Copper-clad laminate manufacturers have also increased their prices amid the shortage of copper foil. Taking the three CCL manufacturers of Taiwan Lianmao, Taiwan Optoelectronics, and Taiyao as examples, their stock prices have risen by more than 50%!
Copper foil production capacity is temporarily unable to keep up with the mobile phone industry's lithium batteries and PCBs.
It is understood that electronic grade copper foil is one of the basic materials of the electronics industry. It is mainly used for CCL, FCCL, and lithium batteries. It can be divided into rolled copper foil and electrolytic copper foil , electrolytic copper foil is mainly used for rigid copper clad laminates (CCL) required for PCB, while rolled copper foil is mainly used for flexible copper clad laminates (FCCL) used for FPC, whether it is rolled copper foil or electrolytic copper Both foils can be used as negative electrode materials for lithium batteries. Lithium batteries and PCB are currently the main application markets for copper foil. Among them, rolled copper foil is very highly used in smartphones, both for mobile phone lithium batteries and PCBs in mobile phones. To the copper foil!
As a leading company in the copper-clad laminate industry, Jiantao has a market share of 14%. Not long ago, it issued another price increase notice and increased the price of all sheet materials by 10 yuan. From the beginning of the year to now, the price of Jiantao copper-clad laminates has It has risen from less than 100 yuan to 140 yuan per sheet. Since copper foil accounts for 40%-50% of the cost of copper-clad laminates, the price of copper foil has also increased by 30%.
As for the reasons for the price increase of copper foil this year, overall, it can be said that it belongs to two aspects. On the one hand, it lies in the smartphone market, and on the other hand, it lies in automotive electronics. In the smartphone market, mainly in the lithium battery business, although the demand for smartphones has not grown much this year, the mobile phone industry chain was not optimistic about the global smartphone industry this year, resulting in insufficient estimates of the market. Based on recent research agency data Judging from this, domestic mobile phone manufacturers Huawei , OPPO, and vivo have experienced substantial growth in shipments this year, both domestically and globally!
In addition, in terms of automotive electronic lithium batteries, according to Jinju Development, in the past the copper foil industry could only be used in PCBs, but now there are new applications of lithium batteries for electric vehicles, and the expansion of copper foil production requires heavy capital, even for equipment There is no shortage, and it will take one and a half to two years to complete the expansion. With strong demand and slow expansion, the copper foil industry will still be in short supply in the short term.
It is understood that in addition to the strong demand for lithium battery copper foil for electric vehicles, as automotive electronics applications become increasingly widespread, the area of ​​automotive electronic copper foil substrates has increased dramatically. It is estimated that the area of ​​copper foil substrates for each vehicle will increase from the current 0.5 square meters. to 2 square meters. If it is estimated that global automobile sales are about 100 million units per year, it is expected to increase the consumption of copper foil substrates by 150 million square meters. Last year, global sales of copper foil substrates were about 700 million square meters. It is estimated that it will be able to It has grown to 1 billion square meters. It is estimated that 100 million square meters of copper foil substrates use about 70,000 tons of copper foil. In the future, automotive electronic copper foil substrates will increase the demand for copper foil by about 105,000 tons a year.
In response to customer demand, Jinju will continue to slightly expand production and adjust its product portfolio. Jinju said that the company’s strategy is not to win by quantity, but to differentiate its products, that is, its products are targeted at high-frequency, high-speed, automotive anti-collision radar and The layout of 5G antennas and other production capacity will also be expanded with new production capacity, hoping to drive the company's gross profit margin and profit growth. Jinju currently has a monthly copper foil production capacity of about 1,600 tons to 1,700 tons, and is expected to increase slightly to about 1,800 tons next year.In the automotive board sector, Jinju is currently a copper foil supplier to Jianding and a major American automotive PCB board manufacturer. With the demand for automotive boards growing rapidly, automotive products will account for 12% of Jinju’s revenue in the second half of this year. 15%, and is expected to climb to 15% to 20% in the second half of next year.
From the perspective of industry insiders, in addition to its market impact, copper foil also has its own reasons: 1. The electroplating process of copper foil will produce wastewater. Some places do not support the establishment of copper foil factories, but support the environmental impact assessment of the regions where factories are established. It will take a long time; 2. It is difficult to order equipment, and key equipment will not be available until after 2018. Take the cathode roller as an example. Japan is the best at doing it, but only a few can do it, and the shortage is very serious; 3. Copper foil is a relatively closed industry, and technical talents are limited. It takes time to retrain and expand. The project may face the problem of lack of talent; 4. Copper foil is a capital-intensive industry. Expanding a factory with a production capacity of 10,000 tons requires a capital investment of 400-500 million. In addition, buying raw copper requires cash, so funds may need to be prepared 6-6 700 million yuan. Enterprises without strong funds simply cannot support expansion. According to the
research agency, the shortage of copper foil this year and the price increase are due to the following reasons: First, the upstream lithium battery copper foil is in short supply due to the new demand for new energy vehicles; existing electronic copper foil manufacturers have switched to producing lithium battery copper foil and have reduced production capacity. , at the same time, downstream PCB demand is recovering, supply is in short supply and prices are rising. Currently, lithium battery copper foil accounts for about 15% of the total copper foil production capacity. Secondly, the price increase of raw materials is transmitted to the copper clad laminate, and the downstream premium ability is relatively strong, so the price increases accordingly. At the same time, the downstream PCB industry is relatively fragmented. Small manufacturers have limited production capacity and are taking advantage of price increases to improve their product mix. It is relatively difficult for large manufacturers to pass on prices to downstream applications.
