PCB Large Factories In July Collectively Issued Price Increase Notice LED Industry Ready

- Aug 28, 2018-

Environmental protection and raw materials double pressure PCB manufacturers "lower prices.

With the continuous improvement of technology, PCB, known as the "mother of electronic products", has become a global industry with an annual output of more than 50 billion us dollars as an unobtainable component in the LED display industry.Although PCB is of great importance to LED display screen, the serious environmental pollution caused by PCB in the production process cannot be ignored, especially at the moment when ecological and environmental problems are prominent, the government attaches great importance to green and environmental protection, and has formulated strict production environmental protection standards.In response to the government's call to realize the sustainable development of industry, the PCB manufacturers of industrial adjustment, improve the product production process, which not only directly increase the accessories price and labor costs of the product, also let the part does not have the competitiveness of enterprises began to exit, the competitive landscape gradually to have bargaining power, environmental indicators, reserve capacity big tilt, lead to industry concentration degree of ascension.

In addition, raw material prices also pressure PCB enterprises out of breath.According to the data, the cost of PCB raw materials is about 33%, among which, CCL accounts for 18% ~ 20%, copper foil is the most important raw material for making copper clad boards, accounting for about 30% (thick) and 50% (thin sheet) of the cost of copper clad boards.As the supply of copper foil is in short supply, the price of various raw materials continues to rise. Since the beginning of 2016, the price of PCB standard copper foil has increased by more than 50%. The processing fee of copper foil and the price of effective copper clad sheet are more than 100% and 50% higher than the original average level respectively.

At this point, in the environmental protection and raw materials prices under the double pressure, a lot of large PCB plants began to "bow", prices have been chosen.It is learned that from the restrictions in kunshan of jiangsu province at the end of 2017, to the restrictions in zhuhai and Shanghai, and now to the strict inspection in shenzhen, the whole PCB industry will face a new situation after this wave of price increases, and the overall range is expected to be 20-30%.

With the advent of the 5G era, the market again falls into the dilemma of "short supply"

In terms of the overall environment of the electronics industry, as China gradually enters the 5G era and consumer electronics faces a new round of development, the demand for high-frequency and high-speed copper clad boards will show exponential growth.As compared with communication, lithium battery and automobile industry, LED display industry has relatively low technical requirements for PCB. At the same time, the reshuffle of small and medium-sized PCB enterprises has LED to the overall capacity compression. In general, big factories have bet their future capacity on communication, lithium battery and automobile industry, which has also exerted a significant impact on LED display industry.

There is no doubt that the large rise in the price of raw materials upstream is bound to catch the downstream LED display industry off guard.At the present stage, the prosperity of LED display market continues to rise, especially the development of LED small spacing is flourishing. The endless market orders not only bring profits to LED display manufacturers, but also raise higher market demand for upstream raw materials.The rising price of PCB and the intensification of industry concentration not only put pressure on the cost of LED display, but also broke the original balance of supply and demand, causing the market to fall into the dilemma of short supply again.

It is worth mentioning that the current situation of tight delivery time and shortage of raw materials such as copper foil and glass cloth, which are the most upstream of PCB boards, directly affects the delivery time of PCB suppliers. Compared with the increase in the price of raw materials, the tight delivery time makes the upstream and downstream manufacturers feel helpless.This raw material price rise storm, beginning those do not have the strength of the economy and scale of LED display enterprises gradually retreat, further accelerating the industry reshuffle speed.

Looking for a sustainable development route without "price war"

The competition in the LED display market is still fierce, and some far-sighted and powerful enterprises have begun to break away from the "price war" and start to move to the high-end display field.For this part of LED display manufacturers, the rise of upstream raw materials will certainly lead to an appropriate increase in the price of LED display products, because their customers pay more attention to product quality and service than the price.Which is still hard for "internal strength", in the "price war" dying of LED display manufacturers, in the face of this round of price increases of raw materials in order to keep the original price product, can only be "strike of the teeth and blood swallow", no matter how much the upstream up, only yourself silently digestion, for enterprise's capital is a huge test, also is not the road to enterprise development of the long-term.

Before the increase in the price of PCB, there are billions of LED display market demand, LED display companies want to swim, you also need to fully consider the long-term development of the enterprise, not die upon product prices, but also from their own technology, products, brands and channels, enhance the competitive power of enterprises, to achieve higher profit margins.