PCB Prices Decline in 2009
Published: 11 March 2009
by Staff
In Asia, pricing for what iSuppli calls “a key product that indicates market trends” began to decrease in October. The firm did not identify the PCB product specifically, but notebook PC and mobile handset boards are well known trendsetters.
The specifics of the key product include that it is an 8-layer multilayer PCB with 5 mil lines and spaces, standard 0.062 mil thickness, built with FR-4 laminate. The price per square inch for this key PCB is expected to fall in the second quarter to 15.3 cents per sq. in., down 8.4% from last October. Pricing is expected to recover slightly in the third quarter, rising 1.3% to 15.5 cents. It is expected to remain at that level in the fourth quarter, says the research firm.
“Weak demand is negatively impacting PCB demand,” said Jason Ma, director and senior analyst, pricing and competitive analysis for iSuppli. “However, PCB pricing trends now are being dictated by copper costs.”
Ma noted that the price of copper reached a peak level of $4.10 per lb. in the second quarter of 2008, and then began to drop, falling to $1.50 per lb. in February. The reduction in copper costs has spurred falling laminate prices allowing PCB suppliers to reduce board costs. PCB demand is expected to rise slightly in the third quarter, boosting pricing, Ma predicts.
Demand for PCBs has fallen significantly since the global economic crisis began. The major applications for Asian produced PCBs are notebook PCs and consumer-oriented products such as mobile handsets and flat panel displays, which have all seen a drop in demand.
PCB fabricators have had to cut costs to match declines in factory utilization. In addition, the Chinese government is beginning the process of increasing its tax on corporate profits to 25% in 2012, up from 18% in 2008. China’s government is also more rigidly enforcing environmental protection laws that place new financial burdens on the PCB industry.
“This combination of factors is hurting PCB makers in China,” Ma noted. "PCB suppliers have been forced to move their facilities to new locations like Vietnam or India.”
