Field Survey: The price of electronic cloth may continue to rise in the short term

Driven by the surging demand for AI computing power, the market of electronic fabric, the upstream segment of PCB (Printed Circuit Board) industry, is being pushed to a new high.

On the supply side, products such as ultra-thin and low-dielectric special fabrics are in short supply with dwindling inventory, and listed companies in the industrial chain are stepping up the layout of new production capacities. On the demand side, the rumor that NVIDIA is testing a computing backplane without electronic fabric has disturbed industry expectations. Against this backdrop, how will relevant listed companies make their layouts? When will the newly added production capacities be released at scale? What is the short-term price trend of electronic fabrics?

According to interviews by reporters from CLS, the mismatch between supply and demand is the leading factor behind this round of electronic fabric price hikes. At present, the industry is in a dual-tight pattern of "gap in conventional fabrics + severe shortage of special fabrics". Coupled with the fact that new production capacities are difficult to be released at scale in the short term, it is expected that the price of electronic fabrics will continue to rise in the near future.

Regarding the recent rumor that NVIDIA's next-generation Rubin Ultra computing backplane is testing a solution that does not use electronic fabric, a listed company admitted that the rumor is currently in the direction of material R&D and is still in the concept verification stage. To reduce costs, leading enterprises are exploring better technical routes, conducting R&D along the directions of inorganic materials and organic materials respectively. "From the communication with downstream customers, it can be foreseen that the application status of fiberglass fabrics will not have major problems in the future, and substitution may only occur in some special and small-volume application scenarios."

Product Price: Year-on-year increase in the recent period exceeds expectations, further rise is expected

Driven by the growing demand for AI computing servers, switches, automotive electronics, IC chip packaging substrates and other products, the demand for high-end electronic fabrics is significantly higher than the same period of last year, leading to a substantial increase in the performance of leading enterprises in the first three quarters of this year.

Entering the fourth quarter, the tight balance between market supply and demand continues.

At the recent performance briefing, International Composite Materials (301526.SZ) stated that the supply and demand in the electronic fabric sector is currently tight, and the inventory of various product categories is at a low level. China Jushi (600176.SH) clearly stated that the supply of electronic fabrics is still tight, the company maintains a low inventory level of electronic fabrics, the price of its electronic fabric products has been adjusted in October, and the implementation is in good condition.

"The short-term demand for electronic yarn and electronic fabric market continues recently, and the orders of national standard yarn and standard fabric of mid-to-high-end products have not decreased significantly, and most manufacturers are still in short supply within the month." Liu Yang, an analyst from Zhuochuang Information, told the CLS reporter that compared with normal years, the current industry inventory continues to be at a low level, with the inventory of individual large manufacturers being about one week, and most small manufacturers having almost no inventory. In particular, high-end products such as thin fabrics and ultra-thin electronic fabrics are in short supply, while the supply of 7628 (ordinary thick fabric) is slightly better, with a turnover inventory of about two days.

Against this backdrop, the price of electronic fabrics continues to rise. Public data shows that on November 3, the quotation of ordinary thick fabric 7628 was 14.6-14.65 yuan per meter, up 1.5 yuan per meter month-on-month, and more than 10 yuan per meter higher than the beginning of the year. For mid-to-high-end thin fabrics, the quotation of 2116 is 20.2 yuan per meter, up 2.5 yuan per meter month-on-month, and the quotation of 1080 thin fabric is 20.75 yuan-20.8 yuan per meter, up 2.5 yuan-2.6 yuan per meter month-on-month, both of which have increased by more than 140% within the year. Due to the tighter supply of high-end ultra-thin fabrics, the price increase is even higher.

"The ex-factory pickup price of 7628 thick fabric from individual manufacturers has exceeded 15 yuan per meter, with a year-on-year increase exceeding expectations, reaching the highest level in nearly 10 years." Liu Yang told the CLS reporter.

Regarding whether the price of electronic fabric products will continue to rise within the year, a CLS reporter recently called the securities department of Sinoma Science & Technology (002080.SZ) as an investor for inquiry. The staff did not give a direct response, only stating that the product is still in short supply at present, and the company's capacity utilization rate is at full production status.

However, the CLS reporter noticed that Sinoma Science & Technology recently stated during institutional research that it is expected that electronic fabrics will still be in short supply in Q4 2026, and this trend is expected to continue. The prices of the second-generation low-dielectric fiber fabrics and low-expansion fiber fabrics are stable, showing an overall steady rising trend, with the core support coming from the continuous growth of downstream demand for the second-generation low-dielectric fiber fabrics.

Liu Yang also believes that there is no obvious sign of price drop at the current level, but whether the price can continue to rise depends on the negotiation results between manufacturers and downstream customers. At present, the price of electronic fabrics is at a historically high level. Under the superposition of multiple factors, the price will most likely continue to rise to a certain extent, but the rising range may narrow slightly.

In terms of the proportion of high-end product sales, Mao Jiaming, Chairman of Honghe Technology (603256.SH), revealed that the revenue of special fabrics accounted for 30% to 40% of the total electronic fabric revenue from January to September 2026. The investor minutes released by Sinoma Science & Technology on October 27 show that the proportion of its high-end categories such as the second-generation low-dielectric fiber fabrics and low-expansion fiber fabrics continues to increase.

Supply: Supply and demand gap will remain before the end of 2027

The AI computing power equipment drives the explosive growth of demand for high-end electronic fabrics, but there is a rigid bottleneck in the overall production capacity of the industry. Attracted by the higher added value and profitability of high-end electronic fabrics, leading enterprises convert part of their low-end fabric production capacity to produce high-end thin fabrics, which passively reduces the supply of low-end thick fabrics, forming the current dual-tight pattern of "gap in conventional fabrics + severe shortage of special fabrics" in the industry.

Against this backdrop, the market has a tight expectation for the medium and long-term supply rhythm. Leading enterprises such as China Jushi stated that it is expected that the increment of electronic fabric supply in 2027 will hardly match the growth rate of downstream demand, and the tight balance pattern of industry supply and demand is expected to continue.

"The core variable of the supply and demand pattern in 2027 lies in: the industry is dominated by capacity expansion of leading enterprises, with limited space for capacity expansion of second and third-tier small and medium-sized manufacturers, and almost no new capacity added. The follow-up focus will be on whether the commissioning time of new production lines of large leading factories and the increment of thick fabrics brought by product structure adjustment can match the market demand." Liu Yang told the CLS reporter.

However, capacity expansion is restricted by factors such as the delivery lead time of high-end looms, capital expenditure and construction cycle of pool kilns, and customer certification cycle. Among them, more than 90% of the global air-jet looms for high-end electronic fabrics are occupied by Toyota Industries Corporation, and its market share in the field of ultra-thin fabrics of 1080 type and below is close to 95%. Restricted by production capacity, the normal delivery cycle of high-end looms is 18-24 months.

At the same time, the equipment of electronic fabric production lines requires platinum-rhodium alloy bushing (about 90% platinum + 10% rhodium), and the value of precious metals alone for a single production line often amounts to tens of millions of yuan. Since the beginning of this year, the prices of platinum and rhodium have risen and are easy to rise but hard to fall, leading to a substantial increase in equipment investment for new production lines and a longer payback period of investment. Sinoma Science & Technology recently stated during investor reception that the current prices of precious metals such as platinum are at a high level, and there is pressure on the new supply of the second-generation low-dielectric fiber fabrics.

In terms of customer certification cycle, the certification cycle varies with different product types. The certification cycle of traditional thick fabrics usually ranges from 1-2 months to 3-4 months. It is reported that the second-generation low-dielectric fiber fabrics have higher technical barriers and longer customer certification cycle, and the supply release rhythm is restricted by technical bottlenecks. The improvement of its yield is a systematic project covering glass melting improvement, glass formula improvement, wire drawing operation and weaving process, so it is difficult to expand rapidly to make up for the existing supply gap in the short term.

According to public information, the current capacity layout of listed companies is concentrated in the high value-added track. In addition to the first phase of China Jushi's Huai'an project (total capacity of 390 million meters per year) which was ignited in March this year, and the 60 million meters annual expansion project of Jin'an Guoji (002636.SZ) in Ningguo, Anhui (total capacity increased to 220 million meters per year) which reached full production in October this year, the company recently announced that it plans to invest 500 million yuan to build a new project with an annual output of 130 million meters of electronic-grade fiberglass fabrics, which is expected to be completed in one year, and the capacity will be released by the end of 2027.

Among them, part of the production capacity of Sinoma Science & Technology will be put into production the fastest. A CLS reporter learned from the securities department of Sinoma Science & Technology as an investor that the total capacity of the three special fiber fabric projects under construction is 94 million meters, of which the first phase project with an annual capacity of 35 million meters is expected to be fully completed and put into operation before the end of this year. According to the 18-month construction cycle, the main release nodes of the other two projects may fall in 2027.

For China Jushi, the construction period of the 50,000 tons annual electronic yarn and 320 million meters annual electronic fabric production line project, and the 250 million meters annual electronic fabric production line project are both 1.5 years. Calculated from the review time of the projects, they are expected to be put into operation from the second half of 2027 to 2028.

International Composite Materials recently announced that it plans to invest 1.158 billion yuan to build a high-performance electronic fiber fabric project, with the construction period from November 2026 to September 2027.

The high-performance electronic material industrial park of Honghe Technology in Huangshi is planned to have a high-end electronic fabric capacity of 150 million meters per year, positioning for extra-thin and ultra-thin fabrics, and construction started in June 2026.

This article is from the WeChat Official Account "CLS", author: Lu Tingting, published with authorization from 36Kr.