OSI Electronics reports:
Not surprisingly, copper prices are returning to the highs last seen ten years ago – as of 24th February, it was $4.30 per pound, having begun 2021 at $3.5545. It has dropped back a little since, but its volatility continues to show upward swings.*
The inevitable result is a significant increase in the pricing of PCBs, with the 30 year index of bare board prices now being at an all-time high.*
Uncomfortable
The current status of copper clad laminate (CCL) PCB boards (the base coating enabling gold, silver, nickel, etc to be added) is best described as being ‘uncomfortable’:
- Supply and demand imbalance.
- Resin shortage.
- Copper shortage.
- CCL supply on allocation based on historic usage.
The result is longer material lead-times and significant cost increase.
Gold and silver also up
Other factors are not helping: gold hit a 20 year high of $2,070/oz at the start of 2021 (it has since fallen to $1,726.85/oz) and silver, at $26.09/oz, is climbing back to an eight year high – thankfully nowhere near (yet) the extreme 2011 high of $48.58/oz.*
Shipping prices have also rocketed – since November the cost of shipping a 40-foot container from Asia to Europe has risen more than three-fold, from around $2,200 to over $7,900.*
On the supply front, copper supply is struggling to keep up with growing demand from the power and construction sectors, compounded by the proliferation of electric vehicles.*
So where’s it all going?
To China – with factory capacity being consumed by:
- Rebound in vehicle sales, fuelled by surging demand for EV and trucks.
- 5G infrastructure projects.
- Factory activity expanding – the fastest pace for three years.
- Mobile phone providers building stocks for anticipated 2021 demand.
- White goods and commercial demands have increased.
Set against this is the steady rise of the UK pound over the US dollar in the last 12 months which is helping to offset some of the price rises of imported materials and components.
Comment
“Let’s not forget PCBs are the heart of everything electronic,” says John Harley, OSI Electronics UK’s Director Business Development UK & EMEA, “so potential supply difficulties emphasise, as I’ve remarked before, the need to partner with us from the earliest point in your design cycle.
“Why? Partly because forward ordering components will help to mitigate delays and also because there are significant material and cost savings in designing PCBs for manufacturing efficiency.”
* Source information
Copper prices
PCB bare board price index
Gold and silver prices
Container shipping costs
Copper supply
OSI Electronics UK is a subsidiary of Californian based OSI Electronics.