PCB prices surge as Middle East conflict disrupts supply chains

The ongoing conflict in the Middle East has disrupted global supply chains and led to a sharp rise in prices of printed circuit boards (PCBs), which are essential components used in smartphones, computers, and artificial intelligence servers.

Industry sources say manufacturers were already struggling with rising costs of memory chips, but the situation has worsened due to the war-related disruption of key raw materials, especially chemicals used in electronics production.

A major setback came after reported strikes on Saudi Arabia’s Jubail petrochemical complex in early April, which forced a halt in production of high-purity polyphenylene ether (PPE) resin. This material is critical for making PCB laminates used in advanced electronics.

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SABIC, a major global supplier responsible for around 70 percent of the world’s PPE output, has been unable to resume production at the affected facility. As a result, global supply has tightened significantly. Shipping routes in the Gulf have also been disrupted, further impacting delivery timelines and logistics.

At the same time, demand for PCBs has been rising due to the rapid expansion of artificial intelligence infrastructure. Companies are building more AI servers, which require advanced multi-layer PCBs, pushing demand higher than supply.

According to industry estimates, PCB prices increased by up to 40 percent in April alone compared to the previous month. Analysts expect prices to remain high as demand continues to outpace supply.

Other essential materials, including copper foil and glass fiber, are also facing shortages. Copper prices, which make up a large portion of PCB production costs, have risen sharply this year.

Experts warn that if instability in the Middle East continues, it could further strain global electronics manufacturing and increase costs for consumers worldwide.