Ajinomoto Raises ABF Substrate Film Prices 30% as AI Demand Extends Supply Gap to 2027

Ajinomoto Confirms 30% ABF Film Price Increase

Ajinomoto Co., the Japanese chemical company and dominant global supplier of ABF (Ajinomoto Build-up Film), has informed IC substrate manufacturers that it will raise prices for its critical build-up film by approximately 30%, with new pricing expected to take effect in Q3 2026.

The price increase comes as the ABF substrate supply-demand gap extends to the end of 2027, driven by explosive demand for AI server packaging. Taiwanese substrate manufacturers—including Unimicron, Kinsus Interconnect, and Nan Ya PCB—are operating at full capacity and are expected to maintain this utilization through year-end.

Sources: WCCFTech | DigiTimes | Commercial Times (Taiwan)

What is ABF and Why Does It Matter?

ABF (Ajinomoto Build-up Film) is a high-performance insulating film used as the dielectric layer in advanced flip-chip ball grid array (FCBGA) substrates. It provides:

• High-density interconnect: Enables fine-line routing (L/S < 10μm) between chip and package
• Low dielectric loss: Dk ~3.3 at 1GHz, suitable for high-speed signaling
• Excellent planarity: Smooth surface for laser via formation
• Thermal stability: Withstands multiple reflow cycles without degradation

Every AI GPU (NVIDIA H100, B200, Blackwell), HPC processor, and high-end networking ASIC uses ABF substrate technology. Ajinomoto commands an estimated 90%+ market share in ABF film supply globally.

Supply-Demand Dynamics

Current Situation

• ABF substrate spot prices have increased by over 30% in recent months
• Standard pricing for substrate makers rising 5-10% (effective H2 2026)
• Top-3 Taiwanese substrate fabricators at maximum capacity utilization
• Lead times for ABF substrates extended to 20-30 weeks (vs. normal 12-16 weeks)

Why Supply Can't Keep Up

1. AI supercycle demand: Each AI GPU requires 1-2 large ABF substrates (70×70mm or larger)
2. Capacity investment lag: New substrate fab lines take 18-24 months from decision to production
3. Yield challenges: Advanced substrates (>12 layers, <8μm L/S) have 60-70% yield rates
4. Material supply chain: ABF film production expansion requires Ajinomoto facility buildout

Downstream Impact

The 30% ABF film price increase translates to approximately:

• 3-6% cost increase for finished ABF substrates (film is ~10-15% of substrate BoM)
• 1-2% cost increase for packaged AI chips
• Potential allocation constraints for smaller substrate buyers

Implications for the PCB Industry

1. Substrate vs. PCB Competition for Materials

ABF substrates and advanced PCBs share some supply chain elements:

• Glass reinforcement materials
• Copper foil (both use ultra-thin <12μm foils)
• Clean room manufacturing capacity
• Engineering talent

As substrate manufacturers ramp capacity and raise compensation, PCB fabricators may face tighter access to shared resources.

2. HDI PCB Pricing Pressure

High-density interconnect (HDI) PCBs that use build-up layer technology are materially similar to IC substrates. As ABF film prices rise, alternative build-up materials (epoxy-based RCC, liquid dielectrics) used in HDI PCBs may also see pricing pressure from:

• Raw material competition (same resin chemistries)
• Equipment competition (same laser drilling machines)
• Workforce competition (similar skillsets)

3. Board-Level Design Implications

With substrates becoming more expensive, PCB designers may need to:

• Optimize BGA escape routing to use smaller substrates
• Consider alternative package technologies where substrate cost is a factor
• Design for standard substrate sizes rather than custom dimensions
• Evaluate chiplet architectures that use multiple smaller (cheaper) substrates

Industry Response

Major substrate manufacturers are responding with capacity expansion plans:

Company	Expansion Plan	Timeline
Unimicron	New plant in Taiwan	H2 2027 production
Ibiden	Japan facility expansion	2027
Shinko	Malaysia new fab	Late 2027
AT&S	Austria advanced substrate line	2027-2028

However, analysts note that even with these expansions, demand growth (driven by AI training and inference scaling) is expected to outpace new supply through at least end of 2027.

Connection to Semiconductor Materials Record

This price increase connects directly to the broader semiconductor materials market story. SEMI's recent report showing packaging materials growing 9.3% to $27.4 billion in 2025 reflects exactly this dynamic—advanced packaging materials are the tightest sector in the semiconductor supply chain.

The $73.2 billion total materials market is increasingly weighted toward packaging, as advanced node scaling drives more value into packaging and interconnect solutions rather than just transistor density.

What to Watch

• Q3 2026: New ABF film pricing takes effect—watch for substrate price pass-through
• H2 2026: Substrate maker quarterly earnings will show capacity utilization and ASP trends
• 2027: New substrate fab capacity coming online—will it match demand growth?
• Alternative materials: Development of non-ABF build-up dielectrics gaining urgency

---

AtlasPCB monitors semiconductor supply chain developments that affect PCB material availability and pricing. For current lead time estimates on HDI and advanced-technology boards, contact our engineering team.