PCB Tech - Driven by 5G, the indispensable raw materials for this kind of soft board will be intensified

Broad prospects for growth in the terminal application market

Soft boards are mainly used in consumer electronics, automotive electronics and other fields. Electromagnetic shielding film is the core material for FPC to achieve electromagnetic shielding to ensure normal operation. The growth of consumer electronics, automotive electronics and other fields drives the growth of FPC demand and brings high prosperity in the electromagnetic shielding film industry.

The smartphone market is still expanding, and new demand + replacement demand supports the FPC market. 5G mobile phone sales are expected to surpass 4G mobile phone sales in 2024, and 5G mobile phones use more FPCs than 4G mobile phones; the new demand for smartphones + replacement demand will continue to support the FPC market, and the FPC market for smartphones is expected to reach 12.7 billion in 2025. For US dollars, the CAGR for 2019-2025 is 14%.

The market of wireless earphones and smart watches brings new growth points in the electromagnetic shielding film market. In recent years, the market size of smart wearable devices such as wireless earphones and smart watches has grown rapidly. Such devices have narrow cable space and a large number of FPCs are used, which in turn promotes the growth of the electromagnetic shielding film market. Apple Watch uses 13 FPCs, and AirPods China uses 6 FPCs.

Global FPC production capacity is further transferred to domestic

The growth rate of FPC companies in mainland China far exceeds that of other regions. The industry concentration of FPC is relatively high, with CR3 output value accounting for 54%, of which mainly Japanese, South Korean and Taiwanese manufacturers, while mainland manufacturers have a smaller share; among the top ten FPC companies in the world, Japanese and Korean companies are experiencing negative growth. The state of rapid growth, only mainland Chinese companies maintain rapid growth, which fully reflects the current trend of global FPC production capacity shifting to mainland China;

It is expected that the global FPC production capacity will be further transferred to mainland China in the future. After 2003, thanks to the advantages of the Chinese market and labor costs, foreign businessmen set up factories on the mainland. China has become an important undertaking country for the global FPC and electronic product industry. In 2019, more than half of the global output value of FPC production value comes from China. mainland. Among them, foreign companies in Japan and Taiwan have first-mover advantages in technology, scale, and industrial chain coordination. In 2018, they have 55% of the global FPC output value. In 2019, the FPC market in mainland China is 58% of the global market, and it is expected to reach 72% by 2030E. With the continuous transfer of global FPC production capacity to mainland China, it is expected that the FPC market in China will reach 19.6 billion yuan in 2025 and 2030. 27.2 billion yuan, with a CAGR of 16.1% and 11.8% for 2019-2025 and 2019-2030, respectively.

5G promotes an increase in the area of electromagnetic shielding film per unit area of FPC

The increase in communication frequency promotes the improvement of circuit integration: the increase in communication frequency improves the efficiency of information transmission, and at the same time puts forward higher requirements on the ability of the electronic device to process information. The direct manifestation of this requirement on the hardware is an increase in the number of components.

The increase in integration promotes the enhancement of electromagnetic interference: the increase in the number of components leads to an increase in interference sources, and the increase in circuit integration leads to a reduction in the distance between components, and the increase in communication frequency itself causes more serious electromagnetic interference.

In 2017, the average ratio of electromagnetic shielding film area per unit area of FPC was about 25%. Under the general trend of the 5G era and the continuous improvement of circuit integration, this ratio is expected to increase further, and is expected to reach 40% in 2025.

Global and China electromagnetic shielding film market total scale calculation

It is estimated that the global electromagnetic shielding film market will reach 3.15 billion yuan and 5.04 billion yuan in 2025 and 2030, respectively, and the CAGR will be 22.7% and 16.7% in 2019-2025 and 2019-2030 respectively; global FPC production capacity will further shift to mainland China, prompting China's electromagnetic shielding film market is growing at a faster rate. It is expected that the market size will reach 2.16 billion yuan and 3.62 billion yuan in 2025 and 2030, respectively, and the CAGR for 2019-2025 and 2019-2030 will be 25.9% and 18.9%, respectively.