AI is driving the upgrade of the electronic yarn industry, and high-end glass fiber cloth is experiencing explosive growth.

Electronic-grade glass fiber yarn (electronic yarn) is a key raw material in the electronic information industry. Electronic cloth woven from it is a core component of copper-clad laminates (CCLs), which are then used in the production of printed circuit boards (PCBs). With the rapid development of 5G, AI, autonomous driving, and new energy vehicles, the demand for high-frequency, high-speed PCBs and CCLs has surged, driving a new wave of upgrades in the glass fiber industry, especially the high-end electronic yarn industry.

High-end electronic cloth: Light weighting and low dielectric constants are key trends.

Electronic cloth is categorized by thickness into thick, thin, ultra-thin, and ultra-thin, each woven from electronic yarn of varying specifications. The demand for lighter and thinner devices is driving the development of electronic cloth towards ultra-thin and ultra-thin fabrics:

Ultra-thin/ultra-thin cloth: Used in high-end smartphones, IC substrates, AI servers, and other applications. The technical barriers are high, and only a few mesh cloth manufacturers worldwide master this technology.

Thin cloth: Used in mid-range smartphones, servers, and automotive electronics. Thick fabric (such as 7628): Primarily used for PCBs in common electronic products such as desktop computers, printers, and LCD TVs, it is a mainstay of many traditional mesh manufacturers.

The thinner the electronic fabric, the faster the signal transmission speed and the higher the added value, but also places more stringent technical requirements on the glass fiber industry. For example, according to Honghe Technology's project data, approximately 0.31 tons of electronic yarn are required for every 10,000 meters of electronic fabric. The thinner the product (for example, ultra-thin fabric requires only 0.15 tons per 10,000 meters), the lower the unit yarn usage, but the higher the yarn quality requirements (such as ultra-fine yarn with a diameter of less than 4μm).

AI servers are driving explosive demand, and low-dielectric electronic yarn holds a promising future.

The explosive growth of AI technology has become a core driver:

The surge in demand for AI servers is driving demand for large-scale, high-speed, and high-layer PCBs. The replacement of CPUs by GPUs has increased the number of server PCB layers from 14-24 to 20-30, significantly raising requirements for CCL materials (from Very Low Loss to Ultra Low Loss) and the performance of upstream electronic fabrics. High-frequency and high-speed demands: 5G/AI requires low-loss and high-fidelity signal transmission, placing stringent demands on the dielectric constant (Dk) and dielectric dissipation factor (Df), key parameters of copper-clad laminates (CCLs). Electronic cloth is a core material that determines the dielectric properties of CCLs.

Low-dielectric electronic yarn boom: To meet the demands of high-frequency and high-speed CCLs, low-dielectric electronic yarn has emerged. Its glass composition (high SiO₂ and B₂O₃, low Al₂O₃, MgO+CaO) differs significantly from that of ordinary E-glass, making its production extremely challenging (kiln temperatures of 100-150°C and B₂O₃ volatile). The global market is projected to soar from US$280 million in 2024 to US$1.94 billion in 2033 (CAGR of 23.8%). Domestic substitution is accelerating, but technological barriers and high investment coexist.

Demand for AI servers, data centers, and 800G switches will continue to drive growth in high-layer boards, HDI boards, package substrates, and upstream high-end electronic fabrics (ultra-thin, low-k dielectric). A new round of capacity expansion in the fiberglass industry (e.g., new projects at Jushi, International Composites, and Sinoma Technology) is focusing on high-end electronic yarns. Meanwhile, domestic companies, having overcome bottlenecks in low-k dielectric technology, are expected to increase their market share in the high-end mesh market, leveraging cost and service advantages, driving domestic substitution. Optimizing product mix toward higher value-added products (fine yarn, ultrafine yarn, ultrathin fabric, and low-k dielectric fabric) will be key to improving profitability.