Iran War Disrupts Global PCB Supply Chain, Technology Companies' Production Costs Soar

Iran's conflict in the Middle East disrupts the supply of printed circuit board (PCB) raw materials (photo: x @TaiwanNewsEN)

JAKARTA - Armed conflicts in the Middle East have once again had a wide impact on the global industry. This time, the technology sector is one of the most affected after disruptions in the supply of important raw materials caused a surge in the price of printed circuit boards (PCB), vital components used in almost all electronic devices.

From smart phones, computers, to artificial intelligence servers, they all rely on PCBs as the main foundation of electronic systems. When the supply chain of raw materials is disrupted, the entire technology ecosystem also vibrates.

Industry sources and executives said that the Iran conflict has disrupted the supply of crucial raw materials and pushed PCB prices up significantly. This condition is a new pressure for electronics manufacturers who have previously been burdened by rising memory chip prices.

The impact was felt even more after Iran attacked the Jubail petrochemical complex in Saudi Arabia in early April. The attack forced the suspension of production of high-grade polyphenylene ether (PPE) resin, an important basic material in the manufacture of PCB laminates.

Material Crisis Presses the World's Electronics Industry

High-rate PPE resin is the core material in the PCB production process. Without a stable supply, manufacturers have difficulty meeting the increasing market demand, especially from the AI sector.

Major chemical company SABIC is said to control around 70 percent of the world's high-rate PPE supply and operates in the Jubail complex, a coastal area of the Gulf.

However, until now, production has not returned to normal. As a result, the availability of the material has shrunk drastically in the global market.

In addition to production disruptions, the shipping routes in and out of the Gulf region are also disrupted due to the war. This situation exacerbates the delay in distributing raw materials to various countries.

Since the end of last year, PCB prices have actually increased in line with the high demand for AI servers. However, since March 2026, the increase has become sharper as manufacturers compete to secure stock of raw materials.

Goldman Sachs analysts noted that in April alone, PCB prices jumped by 40 percent compared to March.

Cloud service providers have even been said to be willing to accept further price increases as they expect demand to continue to outpace supply in the next few years.

"Demand is expected to remain higher than supply for the long term," analysts wrote in their latest research note.

Prismark's report also estimates that the global PCB industry will grow 12.5 percent to reach a value of 95.8 billion US dollars by 2026.

Technology Manufacturers Start Raising Prices to Customers

The surge in PCB prices has also been exacerbated by the scarcity of other important materials, including glass fiber and copper foil.

Copper foil prices have reportedly jumped by 30 percent this year, with an acceleration in the rise since March.

Copper itself accounts for about 60 percent of the total cost of raw materials in PCB production, according to Chinese supplier Victory Giant Technology.

The company had previously warned that the Middle East conflict could potentially push up resin and copper prices.

South Korean PCB manufacturer Daeduck Electronics, which supplies Samsung Electronics, SK Hynix, and AMD, is now discussing price increases with its customers.

A senior company executive said the main focus now shifts from serving customers to finding suppliers.

"Waiting time for chemicals such as epoxy resin now reaches 15 weeks, from the previous three weeks," he said.

This condition shows how fragile the global technology supply chain is when a strategic region experiences a prolonged conflict.

For multilayer PCBs, prices can now reach around 1,394 yuan per square meter, while high-end models for AI servers can touch 13,475 yuan.

This means that the more sophisticated technology the market needs, the greater the cost pressure the industry must bear.

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