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Motherboard and GPU Pricing Under Pressure Due to Copper Foil Shortage

MSI
(Image credit: MSI)

Prices are surging for the copper and copper-clad laminates (CCLs) used to make printed circuit boards (PCBs), which are then used for pretty much every type of electronics device. According to reports from DigiTimes, the cost of manufacturing devices like PC motherboards and graphics cards is rising due to a copper foil shortage, nad now the question is how much of that cost the manufacturers will pass on to the end user. According to some of our quick calculations, the impact of the copper foil shortages could be most felt in lower-end devices, while more expensive premium products might see less of an impact due to already-inflated pricing. 

Costs Are Rising

It's no secret that chipmakers can't produce enough semiconductors due to the overwhelming demand for electronics, which is why chip pricing is high. But in addition to actual chips, all kinds of electronics use PCBs made of glass fiber and copper foil.

The price of copper went up from $7,755 per ton in December 2020 to $9,262 per ton today (September 28, 2021). The cost of copper foil surged 35% since Q4 2020 due to the rising prices of copper and energy carriers. As you would expect, the price for copper clad laminates (CCLs), a foundational component used for making PCBs, increased due to the costs associated with the prices of copper foil and energy. The trickle-down effect continues, and now price quotes for PCBs are increasing, too. 

(Image credit: PCBgogo)

This will affect costs and possibly prices of all kinds of electronics, but PCs, motherboards, and graphics cards will experience more pricing pressure than other components because they tend to use large PCBs with a high layer count. 

Every PCB is built using multiple CCLs, depending on the number of layers. Each CCL consists of several sheets of fiberglass plastic impregnated with epoxy resin that are stacked together and then covered with ~0.035-mm thick (or even thinner) copper foil on both sides. Traces on motherboards are formed by etching away unnecessary copper using processes like those used in microelectronics production (you can read more about the process here). 

Each ATX-sized CCL (305x244 mm) uses around 23 grams of copper (we calculated it here), but a high-end motherboard uses a PCB with at least eight layers (i.e., eight CCLs), so it consumes at least 184 grams of copper (probably more, but we'll stick with this number). Therefore, before processing, a metric ton of copper is enough to build 5,434 eight-layer motherboards, which means that one ATX motherboard consumed $1.42 worth of copper in December and uses $1.70 worth of copper today. But that's before we add in the costs of turning the copper into a usable form, and before the impending price hikes.

(Image credit: LCY Technology)

While the cost of copper per motherboard did not increase significantly, the cost of copper foil and CCL production increased because of copper prices and rising energy carrier prices.

Right now, a roll of 0.0005-inch copper foil (width: 12 inches, length: 1200 inches) costs $423. Based on our estimates, such a roll is enough for ~62 ATX-sized CCLs, which means $6.8 per CCL or $54 of copper foil per eight-layer ATX PCB. Keep in mind that this is an estimate, and makers of CCLs for motherboards hardly use off-the-shelf copper foil. In addition, transportation fees are high since the demand for transport also increased due to the pandemic, leading to other secondary cost increases.  

Overall, the costs of copper, copper foil, copper-clad laminates, PCBs, and manufacturing have increased quite meaningfully due to various factors. The price increases are not going to stop, though. Chinese CCL makers recently announced price hikes for their PCB customers, DigiTimes claims. Copper foil suppliers are also reportedly mulling increasing their processing fees to CCL makers in early 2022, which is why the latter are now negotiating with their customers to provide them reasonable offerings while ensuring decent profit margins. 

Other Factors

In addition to the demand for PCs, other factors are driving up the prices of PCBs and CCLs. Copper prices are increasing not only because of high energy prices, but because demand for copper wires is growing as many applications switch from aluminum wires to copper wires. Transitioning to renewable energy sources requires brand new power generation equipment, which further hikes the demand for copper wires.   

Meanwhile, as carriers transit to 5G networks, they acquire appropriate equipment, including base stations and networking systems that happen to use loads of copper wiring as well as high layer count PCBs that use many CCLs. Growing demand for such equipment naturally adds pressure on copper foil makers, CCLs and PCBs. 

Should We Worry?

The price of copper hit a historical high in June, but since then, it went down and is now on the levels of 2010 ~ 2011, according to MacroTrends. But what impacts the costs of electronics is not the price of copper per se, but rather the price of copper foil, which is quite high these days. 

While the cost of copper foil, CCLs, and PCBs is surging, its impact on pricing for graphics cards, motherboards, notebooks, and desktop PCs will vary.

(Image credit: AMD)

A 10% price increase of one of the key components will be noticeable in the case of entry-level motherboards that are not sold with hefty profit margins and retail for $100 – $200. The same can be applied to inexpensive electronics that use relatively complex PCBs and relatively cheap active components (e.g., entry-level PCs). Hence, if you buy budget hardware, you may want to think about your purchase strategy.

The cost of active components (processor, memory, PMICs, etc.) still accounts for the lion's share of electronics build of material (BOM - the price to construct the product). Thus, even if copper foil pricing increases by 10%, it will hardly impact the price of a high-end motherboard that nowadays may retail for $350 – $900, since manufacturers might absorb the increase without passing it to the end-user. Something similar can be said about graphics cards and their retail prices: even if one ingredient gets a 10% price hike, a graphics card that uses it will hardly get significantly costlier at retail since it is already sold at an inflated price. So, if you buy expensive devices, you should probably not worry about the prices of copper, copper foil, CCLs, and PCBs.

But in addition to pricing, there is also the demand aspect. The world is deploying more electronics than ever, so until supply chains are ready to support this demand, there will be multiple factors that will affect the pricing and availability of electronics.

  • artk2219
    Sweet, another reason for even more expensive commodity items, awesome. Realistically its not a huge deal on a consumer level, but for OEM's with already tight profit margins, not the best news.
    Reply
  • Krotow
    The message for general public - no consumer electronics for you in any form for next 100 years - give or take. Go back to countryside and start living as peasants.
    Reply
  • Kridian
    Tap Alaska and be done with these Eastern scare tactics.
    Reply
  • hotaru251
    Krotow said:
    The message for general public - no consumer electronics for you in any form for next 100 years - give or take. Go back to countryside and start living as peasants.
    insert Weird Al Yankovic's Amish Paradise song ;)
    Reply
  • thisisaname
    For me the TL;DR of this is no the copper price rise will not increase the price of good due to the small amount used. The price will be raised due increases in energy and transport costs.
    Reply
  • spongiemaster
    Fed Ex adds buffet tables at airport terminals. Fatter pilots increasing jet fuel usage. Chip prices going up.
    Reply
  • IceQueen0607
    As Klaus Schwab said "You will have nothing and be happy".
    Here when something fails it ends up as landfill. There is no attempt to recycle anything except plastics.
    No wonder there are shortages of all of these metals; silicon, gold, silver and so on.
    Reply
  • lazyabum
    Copper still abundant in the world. It's obviously lack of production.
    Reply
  • albundyhere
    Krotow said:
    The message for general public - no consumer electronics for you in any form for next 100 years - give or take. Go back to countryside and start living as peasants.

    way ahead of you. bought a 2nd house with land right before covid hit, and been "working from home" ever since, haha. the family loves it out here. none of us ever want to go back to the city. what for? to get infected and live in misery? anyhoo, i'm not using as much tech as i used too...too busy enjoying the outdoors. peasant life is good when you've got money.
    Reply
  • Didymos
    Most sophisticated machines have their own programming language.
    The human brain, which is only a biological machine but the most sophisticated existing on Earth, also has its programming language: Propaganda.

    When you own all the media, the mines (copper, iron, gold, uranium, etc.) and many other things because you have trillions, quadrillions of fine dollars, you can make people believe anything.
    And with the birth of computers and the Internet, it's easier than ever.
    For example, by repeating it enough, we could make people believe that elephants are pink.

    The people forget that now there is only one system, the Capitalist - it must be said that everyone else was just as sh*t. And the latter has only one goal: to make more and more profits.
    In the past, we did not hesitate to wage wars in order to get richer.
    Because nuclear weapons were invented now, we have more sophisticated economic wars than ever before and of course biological wars.

    The Capitalist hates sharing and loves monopolies.
    Countries do not exist and that is why everything is in the hands of the "private", the multinationals.
    They pay nothing, offloading all their expenses to the population, keeping all the profits.

    Besides, another thing that the people want to ignore, to make a profit is to be bandits, is to steal from others.
    Indeed, the Capitalist is based on selling products or services more expensive than they are actually worth.

    Money to humans is more important than anything, especially life in all of its forms.

    Why doesn't no "country" make its own things like microchips?
    Why do countries not provide good education, health, housing, food to its people?

    Because countries don't exist. Multinationals are using puppets, politicians, "journalists" and the like to say that nothing can be done without the "private" and that anything public is big sh*t. That the "private" is paradise. Indeed, it is paradise for the rich who pay nothing at all and steal all the wealth.

    And people who dare to criticize the capitalist are listed as intellectual terrorists, communists, socialists.

    The Capitalist has nothing to envy of Nazism. If the latter has his superior race, the Aryans, the Capitalist also has his superior race: the rich. There are already trillionaires and this is just the start!

    And the people have worshiped them for millennia as living Gods.

    Why make a “small” 1000% profit, money that will go directly to tax havens - the people pay for everything that is done "privately" including salaries - when you can make 5000% or more?

    In five years, graphics cards at $ 10,000, CPUs too, and motherboards at $ 5,000?

    And of course, we, the "journalists" will all repeat the same things: it is the "crisis", copper, microchips, etc. And the people believe it because they love lies and hate the truth.

    But of course, there will never be any miser attacks because they are the ones who own everything and control this world.

    Two, three, monopolies for graphics cards. Three (and a half - Linux) for operating systems, etc.

    It just goes to show that there are not enough engineers, technicians, etc. in countries for most to manufacture and design their items. To the public.

    We prefer to leave that to two or three multinationals who do what they want.

    Nothing changes in humans and it is very monotonous and sad to see them do so.
    But when you're no smarter than a rock, it's no surprise.

    Intel must be salivating because it too will be able to sell its graphics cards for $ 2000 or more.
    The rich will buy them, own them, and the people will be happy to pay only. As it does with health, education and everything in between. The rich all go to the "private".

    Why pay something in public, if you really to want continue to live with money – not sufficiently intelligent to live without this sh*t – the real cost when we can pay 100%, 1000%, etc., more buying this something in “private”?


    Repeat after me: it’s the crisis of copper, or microchip, or graphic card, or …, peanut. Of all you want to make more profit!
    Reply