Nanya Plastics Confirms Doubling of Electronic Material Prices This Year; Glass Fiber Cloth Shortage Most Severe

Nanya Plastics Industrial Co., Ltd. (Nanya), a leader in chemicals and electronic materials, confirmed on Friday that it has raised the prices of its electronic material products multiple times since the beginning of this year, with the cumulative percentage gain exceeding 100%. This statement was made in response to widespread market circulation of a price hike notice, which attracted significant external attention.

According to Taiwan's Economic Daily News, regarding the document circulating in the market claiming a "20% price hike," Nanya clarified that the document was not an official price increase notice issued by the company. It is speculated to be intercepted email content from price negotiations with specific customers.

However, the company simultaneously confirmed that in response to the substantial rise in costs for upstream raw materials such as copper foil, glass fiber cloth, and resin, it has indeed been continuously negotiating price adjustments with customers, and the overall cumulative percentage gain for electronic materials this year has exceeded 100%. This news stimulated Nanya's stock price to hit the daily limit up, closing at NT$207.5.

Price Hike Confirmed, But Not Unilaterally Announced

Documents circulating in the market showed that Nanya planned to raise the selling prices of substrates and base materials by 20% each starting September 1, citing the continuous rise in raw material prices such as copper foil, glass fiber cloth, and resin. The company stated it had tried its best to absorb the costs, but the increase was too large, necessitating a moderate adjustment to some selling prices.

In response, Nanya explicitly stated: The company did not comprehensively or simultaneously raise prices by 20% for all customers, but rather coordinated with individual customers one by one, "rather than unilaterally issuing a letter to announce price hikes." The company stated that it has adjusted electronic material prices multiple times this year, with the overall cumulative percentage gain exceeding 100%. This constitutes a phased, gradual price adjustment, not a sudden, single large-scale price hike.

Glass Fiber Cloth Shortage Most Severe, Followed Closely by Copper Foil

Nanya pointed out that among all materials, the shortage of glass fiber cloth is currently the most severe, with a similar situation for copper foil. Both are jointly constraining the supply of Copper Clad Laminate (CCL).

Specifically, regarding glass fiber cloth, Nanya raised selling prices in parallel with capacity expansion and sales growth of low thermal expansion coefficient cloth types; regarding glass fiber yarn, the supply of special glass fibers such as electronic-grade fine yarns, low dielectric, and low thermal expansion coefficient types is tight. While expanding related production volumes, Nanya also raised prices. Regarding copper foil, demand for high-frequency copper foil is strong, with an increased share of orders received. Processing fees were raised for all specifications, and the market situation shows a trend of "rising prices and volumes."

Regarding Copper Clad Laminate (CCL), affected by the tight supply of glass fiber cloth raw materials, peers face limitations in obtaining raw materials. Consequently, the proportion of inquiries and orders directed at Nanya has risen. Nanya stated that in addition to accelerating the expansion of the proportion of high-end products, mid-to-low-end materials are also being price-adjusted based on raw material costs. This is expected to further boost revenue in August and the third quarter.

AI Server Demand Drives Structural Supply-Demand Gap

Nanya previously stated that the four major U.S. Cloud Service Providers (CSPs) continue to expand capital expenditures, directly driving structural shortages and price hike pressures for upstream electronic materials in the supply chain.

AI servers have urgent demand for mid-to-high-end electronic materials due to larger chip areas, increased layer counts, and significantly improved signal transmission speeds and power consumption. However, new capacity expansions are limited by the supply capabilities of equipment manufacturers, making it difficult to close the supply-demand gap for electronic materials in the short term.

Looking ahead to the second half of the year, Nanya stated that benefiting from strong momentum in its core electronic materials business, coupled with the excellent performance of its investee company, Nanya Technology, overall profits in the second half are expected to outperform the first half.

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