A group of key electronics suppliers announced a new round of capacity expansion totaling more than 20 billion RMB ($2.75 billion) to meet surging demand for high-end printed circuit boards (PCBs) used in artificial intelligence hardware. The move comes as demand from Nvidia Corp.'s next-generation products creates bottlenecks across the component supply chain.
"The supply deficit for weaving machines could reach 6.1 percent in 2026 and widen to over 10.6 percent in 2027," analysts at Zhongtai Securities said in a note. "The industry's pricing logic could comprehensively shift to scarcity pricing."
The wave of investment includes a 5.5 billion RMB commitment from WUS Printed Circuit for a new high-density PCB project, which was later supplemented by another 3.3 billion RMB to specifically support AI chip production. In March, ZDT Industrial also announced an 11 billion RMB plan for a new high-end PCB base. Separately, Victory Giant Technology stated it is in a full-scale effort to expand production. The buildout is a direct response to design changes in Nvidia's forthcoming Rubin AI platform, which will increase the value of PCB content per server.
This demand surge is tightening the market for essential upstream materials, leading to significant price increases and forecasts of prolonged shortages. Japan's Mitsubishi Gas Chemical announced a 30 percent price hike for its copper-clad laminates and other products, effective April 1. Analysts project the market for data center PCBs will grow from $12.5 billion in 2024 to $23 billion by 2030, according to Shenwan Hongyuan Securities. The tight supply of high-end materials like reverse-treated copper foil (RTF) and very low-profile (VLP) copper foil is expected to sustain higher prices and benefit domestic Chinese suppliers who can scale production.
This article is for informational purposes only and does not constitute investment advice.
