News
ABF substrate market enters super-cycle with potential 50% price increase amid material shortages
Monday, January 19, 2026 at 07:47 AM
The ABF and BT substrate industry is entering a new super-cycle driven by robust demand for AI servers and general-purpose server upgrades. Supply constraints for T-Glass glass cloth are limiting production, which could lead to price adjustments of over 50% for high-end ABF substrates. Kinsus is the only major manufacturer with a clear expansion timeline, aiming for a 25% capacity increase by 2027. Nan Ya PCB is positioned to benefit from spot price increases due to its high exposure to non-contracted business, while Unimicron maintains stable operations through long-term contracts despite a more cautious expansion strategy.
Context
Goldman Sachs recently warned of a critical bottleneck in the semiconductor supply chain, projecting that ABF substrate supply will fall short of demand by 42% over the next two years. This deficit is driven by the rapid shift toward AI accelerators and data center CPUs, which require complex, multi-layered packaging that consumes significantly more manufacturing capacity than traditional chips. With global supply under extreme pressure, lead times for these essential components are expected to remain elevated through 2027.
While Intel secures high-profile EMIB-T advanced packaging orders from external foundry customers, analysts at Bernstein contend that Ibiden—the primary substrate provider—is the core strategic beneficiary. As a critical supplier to both Intel and Nvidia, Ibiden is aggressively expanding its Japanese production facilities. However, the scale of the projected 42% shortage suggests that new capacity will be absorbed immediately, leaving the market in a state of strict allocation and allowing Ibiden to maintain significant pricing power throughout the current AI infrastructure supercycle.
Sources (1)
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