ABF substrates have seen robust demand for processing 5G networking chips and high-performance computing chips since the start of 2019, but shipments of BT substrates for mobile chips packaging have slipped significantly due to lackluster handset sales, according to industry sources.

Taiwan-based IC substrates suppliers Unimicron and Na Ya PCB as well as Japan's Ibiden and Shinko are now the world's only four makers of high-end ABF substrates. As none of them are able to ready new capacity in the short term, their production lines have been running at full capacity to meet strong demand from clients queuing up to take delivery of shipments, the sources said.

Unimicron pointed out that its clients in both the US and China have asked for higher shipment volumes, but it is unable to simultaneously satisfy demands from all clients. The company is confident that it may maintain full ABF substrate capacity utilization throughout 2020.

Unimicron has decided to invest NT$16 billion (US$510.07 million ) in building new production lines for ABF substrates in 2020, but the additional capacity will not be available until 2021.

Industry sources said that BT substrate shipments for 2019 are not expected to grow from 2018 as weak handset sales linger amid the absence of impressive spec upgrades. But makers are expected to embrace a new wave of shipment growth momentum in 2020, when 5G smartphones has a chance of seeing explosive sales expansion.

More high-end SiP (system in package) and AiP (antenna in package) processes and a much larger number of RF (radio frequency) modules will be needed to support 5G smartphone production. This will sharply push up the prices and shipment volumes of BT substrates, benefiting makers Unimicron, Nan Ya and Kinsus Interconnect Technology, the sources commented.

By: DocMemory
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