News Briefing Following Goldman Sachs and Citibank, Bank of America(BOA) predicts that copper prices will reach $12,000 per ton by 2026. According to BOA, market demand for copper is skyrocketing due to the energy transition, growing demand from India, and the surge in AI and data center construction. By 2026, the supply-demand gap for copper is expected to reach 743,000 tons, pushing the price up to $12,000 per ton. Impact analysis Recently, copper prices have shown strong upward momentum, even reaching a historic high of $11,104.5 per ton on May 20. This surge is primarily driven by a combination of supply shortages and the skyrocketing demand from AI and green energy sectors. On the supply side, increasingly stringent regulations and environmental reviews have made it difficult for mining companies to expand capacity. Additionally, the declining output from existing mines has further exacerbated supply constraints. Although copper recycling rates have increased, they still cannot fully meet the demand. On the demand side, the development of AI technology and the promotion of green energy projects, such as electric vehicles and smart grids, rely heavily on copper's conductive properties, necessitating a large amount of copper. Furthermore, according to S&P Global research, achieving net-zero carbon targets might require doubling the annual copper demand to 50 million metric tons by 2035. Given this supply-demand imbalance, copper prices have continued to rise. The rise in copper prices will directly increase the production costs of copper-clad laminates (CCL). The Chinese-based laminate manufacturer Kingboard has already announced a price increase of about 5-10%, and Taiwanese manufacturers and others are likely to follow, especially for mid- to low-end products which may see price adjustments first. Since CCL accounts for a relatively small proportion (about 10-20%) of the total cost of PCBs, even with the increase in CCL prices, the impact on the gross margins of PCB manufacturers may not be significant. Therefore, in the short term, PCB manufacturers might absorb some of the increased costs themselves, making it difficult to immediately pass on the costs for existing products. For new products, PCB manufacturers may negotiate with customers based on the increased costs of mid- to high-end products. However, if copper prices continue to rise, it will inevitably lead to an overall increase in production costs, which could affect the profitability of PCB manufacturers.