Specialty electronic fabrics have been introduced before, but recently new friends have shown interest and hope to see a comprehensive overview. Specialty electronic fabrics refer to core reinforcement materials used for high-frequency and high-speed PCBs, primarily woven from electronic-grade glass fiber yarn. Compared to traditional electronic fabrics, they possess superior dielectric properties (low dielectric constant Dk and low dielectric loss Df) and thermal stability (low coefficient of thermal expansion CTE).
They can be mainly divided into the following categories:
- Low-Dk Generation 1 Fabric: Dielectric constant approximately 4.8, dielectric loss Df ≤ 0.003, mainly used in consumer electronics and low-end automotive electronics, compatible with M7 grade copper-clad laminates.
- Low-Dk Generation 2 Fabric: Dielectric constant reduced to 4.2-4.3, Df ≤ 0.002, used in traditional servers and mid-to-high-end automotive electronics, compatible with M8 grade copper-clad laminates.
- Low-CTE Fabric: Significantly reduced thermal expansion coefficient (approximately 2.8×10⁻⁶/℃), used in chip packaging substrates and high-end smartphones, enhancing heat dissipation and reliability.
- Q Fabric (Quartz Fiber Fabric): Made from high-purity quartz fiber (SiO₂ > 99.95%), dielectric constant only 3.7, Df ≤ 0.001, thermal expansion coefficient as low as 0.55×10⁻⁶/℃, compatible with M9 grade copper-clad laminates, meeting extreme performance requirements for AI servers and 1.6T switches.
Market Landscape
- Currently, the market is mainly dominated by overseas companies, with Japan’s Nitto Denko (NE series) and Shin-Etsu Chemical (Q Fabric) leading in technology and monopolizing the high-end market. Domestic manufacturers are currently breaking through technical bottlenecks and rapidly expanding production capacity. Some companies, such as Feilihua, can achieve a production capacity of 1 million meters by 2024, and domestic companies are all making layouts. However, besides production capacity, equipment is also limited. High-end weaving machines (such as Toyota JAT910) have a delivery cycle of over 6 months, with a monthly output of only 7,000 meters, which somewhat restricts capacity expansion.
- Due to the long certification cycle of products, such as automotive/AI server certification taking 2-3 years, customer stickiness will be very high.
Driving Logic
- Explosion in AI Computing Power Demand: The global shipment of AI servers continues to grow rapidly, with an expected year-on-year increase of 24.3% by 2025. AI servers need to support high-speed transmission such as 800G/1.6T optical modules, driving PCBs to upgrade to higher layers and higher density, directly boosting the demand for high-end copper-clad laminates and specialty electronic fabrics. For example, the NVIDIA GB200/Rubin platform requires M8/M9 grade copper-clad laminates, corresponding to Low-Dk Generation 2 Fabric and Q Fabric, while the 1.6T switch requires glass fiber fabric Df ≤ 0.001, which only Q Fabric can meet performance requirements.
- Upgrade of Smart Terminals: High-end smartphones (such as iPhone 17) are introducing Low-CTE Fabric for heat management for the first time, with future penetration rates expected to rise from 10% to 20%, with a single device demand reaching 0.05 meters.
- Accelerated Technological Iteration: The 224G high-speed interconnect technology requires PCB materials Df ≤ 0.0009, driving the material upgrade from Low-Dk to Q Fabric. The mass production of NVIDIA’s Rubin platform and the ramp-up of 1.6T switches in 2026 will mark the year of significant demand for Q Fabric.
Institutions predict that by 2025, the total demand for low-dielectric electronic fabrics will reach 93.49 million meters, increasing to 168 million meters by 2026, and reaching 240 million meters by 2027, with Q Fabric growing the fastest, reaching 16.85 million meters by 2026, with a market size of approximately 4 billion yuan, and increasing to 71.88 million meters by 2027, with a market size of 15.8 billion yuan. Low-expansion fabrics are expected to reach 26.4 million meters by 2026, with a market size exceeding 4 billion yuan. The market size of specialty electronic fabrics is expected to be approximately 14.6 billion yuan in 2026, increasing to 29.2 billion yuan in 2027.
Listed Companies Layout
China National Materials Technology (Taishan Glass Fiber): Plans to produce over 100 million meters of low-dielectric Generation 1/2 fabrics and low-expansion fabrics by 2026, with Q Fabric production capacity reaching 8 million meters/year.
Honghe Technology: Focuses on high-end electronic fabrics through customer certification for low-dielectric/low-expansion fabrics, raising funds to expand production of 1,254 tons of high-performance electronic yarn, achieving integrated production of yarn and fabric.
Guangyuan New Materials: Annual production capacity of 80 million meters for low-dielectric Generation 1 fabric, planning to mass-produce Q Fabric by 2026.
International Composite Materials: Low-cost advantages of pool kiln method, products cover 5G/AI servers, with dielectric loss of low-dielectric Generation 2 products reduced by 20%.
Feilihua: Leading the entire industry chain of quartz fiber, with exclusive quartz fiber technology, Q Fabric performance matching Shin-Etsu Chemical, with a production capacity of 1 million meters/year by 2024, and planning 20 million meters of Q Fabric by 2030.
China Jushi: The world’s largest production capacity of traditional electronic fabrics (960 million meters), accelerating the research and certification of specialty fabrics.
JianTao Group: Planning 10 low-dielectric yarn production lines, with significant vertical integration advantages.
Equipment/Materials
Quartz Co., Ltd.: Supplier of high-purity quartz sand, benefiting from the explosive demand for Q Fabric raw materials, conservatively estimating that 1 million meters of quartz fiber fabric will consume 10,000 tons of high-purity quartz sand.
Kai Sheng Technology: Developing high-performance quartz materials relying on the technological advantages of China National Building Material Group, potential supplier of quartz fiber raw materials.
Zhizhong New Materials: Engaged in deep processing of quartz stone materials, with the ability to produce high-purity quartz sand, actively laying out electronic-grade raw materials.
Water Co., Ltd.: Layout of high-frequency communication materials, with specialty resin technology, potential supplier of electronic fabric resin.
Seiko Technology: Supplier of glass fiber production line equipment, benefiting from the equipment renewal demand brought by the expansion of specialty electronic fabric capacity.
Zaisheng Technology: Subsidiary Xuanhan Zhengyuan Microfiber is building a pilot research and development platform, conducting research and development of quartz fiber-related technologies.
Risk: Beware of excessive capacity expansion leading to intensified competition after 2027.
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This article is compiled based on publicly available information and does not constitute investment advice.
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