Tight Supply-Demand Balance Triggers Another Price Hike for Electronic Cloth in October; CCL Cost Increases Smoothly Pass Through to PCBs

Data from multiple agencies show that electronic cloth prices continued their upward trend in October, with month-over-month increases exceeding 10%. Leading listed companies in the electronic cloth industry stated that the sector is currently in a tight inventory balance, with thinner fabrics seeing larger price hikes. Since the beginning of this year, capacity expansions for electronic yarn and cloth at China Jushi and Jian Tao Group have accelerated, alleviating some market supply pressure. Additionally, leading industry players are expanding their electronic cloth production; given the typical 18-month construction cycle, new capacity is expected to come online before the end of 2027. Amid strong downstream AI demand, the electronic cloth sector is poised to continue its high-growth cycle. Meanwhile, several listed copper-clad laminate (CCL) companies noted that rising upstream electronic cloth prices increase their costs, but robust demand for printed circuit boards (PCBs) allows these raw material cost increases to be effectively passed down to customers. Regarding whether PCB price hikes can be passed on to end users, CCL industry leaders indicated that PCBs represent a small portion of the total cost for many end products. Besides PCBs, prices for other electronic components such as capacitors, resistors, and wiring are also rising, driven by strong demand from computing power infrastructure construction, leaving the industry's price increase logic unchanged.