1.Background 

the China 5G Economic Report 2020, released at the recent "China 5G Economic Symposium" held in Beijing, predicts that total investment in 5g will reach 0.9 trillion yuan by 2020 and 1.5 trillion yuan by 2025, 130,0005G base stations will be built in 50 cities this year. We know that printed circuit board will inevitably be used in the construction of 5G base stations, and one of the key components is the copper clad laminate, as 5g enters its full construction cycle in 2020, copper Industry chain is expected to bring a certain amount of demand, this article focus on this, and we discuss the demand for this part of the roughly how much.

2. Logic

this paper will be from 5G, printed circuit board and CCL three parts, roughly estimated the construction of 5G base station on copper demand pull, calculation and verification methods are as follows:

Due to the large difference in copper consumption according to different base station types, and due to the lack of data, the weight can not be assigned according to different base station types, therefore, this paper is based on the proportion of total investment for the time being, to calculate the total copper consumption. Then we verify the order of magnitude from the supply side through the total capacity of future CCL.

3.5G

(1)5 G introduction

5g, known as 5TH GENERATION MOBILE NETWORKS OR 5G mobile networks, is the latest generation of cellular mobile technology and an extension of 4G (LTE-A, WiMax) , 3g (UMTS, Lte) and 2G (GSM) systems. Its performance goal is the high data rate, reduces the delay, saves the energy, reduces the cost, enhances the system capacity and the large-scale equipment connection. As with earlier networks, 5G is a digital cellular network in which the service area covered by the provider is divided into many small geographic areas called cells. Analog signals representing sounds and images are digitized in the phone, converted by the Analog-to-digital converter and transmitted as a stream of bits. The main advantage of 5G network is that the Data transfer rate is much higher than the previous cellular network, up to 10Gbit/s, 100 times faster than 4g LET cellular network, and the network delay is lower, the delay level of air interface is about 1ms, while 4G is 30-70ms In addition, under continuous wide area coverage and high mobility, the user experience rate can be as high as 100 mbit/s, and the traffic density and connection number density have been greatly increased. 5g base stations need to be used to transmit signal, because the spectrum is wider, so the number of 5G base stations is more than 4G base stations.

2.5 G base station

5G Base Station is the core equipment of 5G network. It provides wireless coverage and realizes wireless signal transmission between wired communication network and wireless terminal. It is mainly used to provide 5G empty port protocol function and support communication with UE and core network. A standard macrobase station consists of a baseband processing Unit (BBU) , a Radio-frequency processing Unit (Rru) , and an antenna system. BASEBAND processing unit BBU: complete the function of channel encoding and decoding, modulation and demodulation of baseband signal, protocol processing, etc. . The BBU OF 5G base station is divided into CU (Centre unit control unit) and Du (Distributed unit distribution unit) . RF Processing Unit RRU is the intermediate bridge between the antenna system and the baseband processing unit. When receiving the signal, RRU amplifies the RF signal from the antenna through filtering, low noise, and transforms it into optical signal, which is transmitted to BBU, the RRU converts optical signals from the BBU into radio-frequency signals that are sent out by antenna amplification. Antenna system: mainly for the reception and transmission of signals, is between the base station equipment and the end-user information energy converter. From the structure of antenna, 5g RF achieves the transformation from "RRU + antenna" to active antenna AAU. In the widely used distributed base stations, RRU is separated from the BBU and connected to the antenna via a feeder. MIMO technology transforms antenna into integrated active antenna AAU. AAU integrates the functions of RRU and traditional antenna, and the digital interface controls each antenna element independently to form the active antenna array. Since RF units no longer require feeders to be connected to RRU and instead connect directly to the BBU via fiber optic cables, the previously troublesome feed loss tends to zero. In the 5G era, because of the application of Mimo and beamforming technology, 64,128 or more antennas need to be integrated in the single antenna, and the high frequency signal used in 5G needs the RF device with higher performance, the HIGH-FREQUENCY PCB and high-frequency copper-clad plate materials which support antenna vibrators are the most beneficial links in the value chain of 5G antennas. Compared with 3G and 4G antennas, High Frequency PCB and high frequency copper clad plate materials are not needed. It is expected that the added value of 5G PCB in high frequency materials and processing will increase. The price of RF FRONT END PCB will be over 3000 yuan/m2 at least, that's 1.5 times as much as 4G. The market size of PCB and CCL will be several times larger than that of 4G only in RF side.

4.Printed Circuit Board

(1)Introduction to PCB

The Printed Circuit Board, or PCB, is the set of systems that each electronic product carries. Printed Circuit Board. PCB is mainly composed of two kinds of materials: insulating base material and conducting material. It is the provider of electronic components connection and plays the role of supporting and interconnecting in electronic equipment, is the combination of electronics, machinery, chemical materials and most of the electronic equipment products must be the original, known as the "mother of electronic products. ". There are three kinds of PCB classification: Structure Classification, substrate classification and use classification. According to the structure classification, PCB can be divided into three types: Rigid board, Flexible Board (FPC) and rigid-flexible Joint Board. If according to the substrate classification, can be divided into glass fiber cloth substrate, paper substrate, metal substrate, ceramic substrate, etc. . If according to the use of points (that is, according to the downstream application) , can be divided into communication board, Consumer Circuit Board, military board and so on.

(2) PCB INDUSTRY CHAIN PCB industry

 upstream raw materials including copper foil, resin, glass fiber cloth, wood pulp, ink, copper ball and so on, copper foil, resin and glass fiber cloth are three major raw materials. Generally speaking, the raw material cost of PCB industry accounts for more than 50% of the total operating cost, which is the most important part of the gross profit space of PCB enterprises. PCB industry chain in the middle is mainly a variety of printed circuit board manufacturing, product processing. With the development of PCB applications and the innovation of products, PCB can be divided into rigid PCB, flexible PCB, metal-based PCB, HD board and package PCB. A remarkable characteristic of PCB is that the downstream application field covers a wide range, including communication, computer, aerospace, industrial control medical, consumer electronics, automotive electronics, etc. . Among them, communication, computer and consumer electronics have become three main application fields of PCB. The three industries of communication, automobile electronics and consumer electronics are the most widely used PCB, of which communication accounts for 35% , automobile electronics and consumer electronics account for 16% and 15% respectively, and the top three industries account for more than 60% in total.

4.CCL

(1) Introduction to copper shoes

Copper Clad Laminate (CCL) is a basic material for the electronics industry and a core substrate for the manufacture of printed circuit boards (pcbs) . Copper clad laminate (CCL) is a kind of plate-like material which is made by hot pressing the reinforced material with organic resin on one or two sides and covered with copper foil, copper Clad laminates (CCL) account for 30%-40% of the total PCB production cost and account for the highest proportion of all PCB material costs. The glass fiber cloth substrate is the most common type of CCL. It is made of glass fiber cloth as reinforcement material and epoxy as adhesive.

Substrate: An insulating laminate consisting of a synthetic polymer resin and a reinforcing material can be used as a substrate for a copper clad laminate. There are many kinds of synthetic resins, such as Phenol formaldehyde resin, epoxy, polytetrafluoroethylene, etc. . Reinforcement materials generally have paper and cloth, they determine the mechanical properties of the substrate, such as resistance to immersion welding, bending strength, and so on. Copper Foil: It is the key material for manufacturing CCL, which requires high conductivity and good weldability. And the surface of copper foil should not have scratches, sand holes and wrinkles, metal purity is not less than 99.8% , thickness error is not more than ± 5 M. According to the standards issued by the ministry, the nominal series of copper foil thickness are 18,25,35,70 and 105 M. At present, 35 m thick copper foil is being popularized in our country. The thinner the copper foil, the easier it is to etch and drill, especially suitable for the manufacture of high-density PCB with complex circuits. Copper clad laminate adhesive: adhesive is the copper foil can be firmly covered on the important factor. The peel strength of CCL mainly depends on the performance of adhesive. At present, the largest amount of use in the PCB field is rigid organic resin CCL, which includes: paper substrate, glass fiber cloth substrate, composite substrate. In addition to the above types, the rigid CCL also includes multilayer substrate, metal substrate, ceramic substrate, heat-resistant thermoplastic substrate, buried volume substrate materials. Although there are many kinds of copper clad laminates, the epoxy copper clad laminates are the main copper clad laminates, accounting for more than 70% of the total copper clad laminates. They mainly include the following types:

For each type of copper clad laminates, the unit consumption of glass cloth copper clad laminates and composite copper clad laminates can all be approximately calculated as double-sided copper clad laminates, that is, each square meter of copper clad laminates corresponds to the consumption of 2 square meters of copper foil; For paper-based, flexible, metal-based copper clad laminates, all can be approximated by one-side copper clad laminates, that is, each square meter of copper clad laminates corresponding to 1 square meter of copper foil consumption, the total area of copper foil consumed for a given CCL output can then be calculated. The weight of each square meter of copper foil is then multiplied by the total area of the copper foil to obtain the total weight consumed by the copper foil. Of course, this total weight is the effective or net consumption of the finished CCL on copper foil, there is actually a loss rate. Due to the copper clad laminates, according to user requirements, divided into a number of different thickness specifications, there are 3,2,1,1/2,1/41/8 Oz and so on (1 Oz means that the average weight of copper foil on an area of 1 Square foot is 28.35 G, that is, the average thickness of copper foil in terms of the weight per unit area) , becomes relatively complex, the thickness of various copper foil consumption ratio, can only approximate estimates. The estimated value of this ratio varies from period to period in the development of CCL. The main reason is that with the lightening of electronic products and the high integration of electronic component, the requirement of PCB circuit is more and more fine, the distance is more and more small, so the copper foil of CCL is more and more thin. In this sense, the development of copper clad laminates for copper foil by weight is not a stable growth. The Ministry of Industry and Information Technology (MII) has set a target for 5G commercial use by 2020(proposed to use the frequency bands 3300MHZ-3600MHZ and 4800MHZ-5000MHZ) , while 3.3GHZ-3.6Ghz/4.8GHZ-5GHZ corresponds to the centimeter wave phase. The 28Ghz band and the 60Ghz band are the two most promising bands in the millimeter wave band. Because of the high frequency of millimeter wave, there is a great demand for High Frequency Circuit Board in 5G new communication base station.

5.Current market situation of CCL industry in China

In May 2019, the Secretariat of China Electric Materials Association (CCLA) completed a survey on the operation of Chinese copper clad laminate (CCL) enterprises in 2018. The statistical results of this survey reflect the operation of CCL industry in 2018. In terms of production capacity, the total capacity of Chinese mainland is 752 million square meters, an increase of 5% over 2017. Overall, the total CCL output in 2018 was 654 million square meters, an increase of 10.8 percent over 2017. Output growth outpaced capacity growth, suggesting further improvement in Capacity utilization. In 2018, the Capacity utilization of CCL industry was 73.97% , up 3.47% from the previous period. The differences among CCL enterprises in China tended to increase, and some large companies Capacity utilization higher than the overall level in China.

In 2018, the output of glass fiber cloth-based CCL was 419.46 million square meters, accounting for 64.1% , the output of flexible CCL was 61.9 million square meters, accounting for 9.5% , and the output of paper-based CCL was the third, the output was 60.29 million square meters and accounted for 9.2 percent of the total.

From 2010 to 2018, China's sales of various types of rigid copper clad laminate (CCL) showed a fluctuating upward trend. In 2018,648.64 million square meters of CCL were sold, while the sales revenue reached 55.969 billion yuan, an increase of 11.32% and 9.60% respectively over the previous period.

6.Demand forecast of 6G, 5g base station and CCL

According to the Ministry of Industry and Information Technology, 439,000 new 4G base stations were built in China in 2018, bringing the total to 3.72 million. By the end of December 2018, the total number of 4G subscribers had reached 1.17 billion, representing a net increase of 169 million for the whole year and a penetration rate of nearly 84 per cent. This is lower than countries and regions such as Japan (nearly 110 per cent) and Korea (99 per cent) , which are among the world leaders, and still have room for development. The total number of mobile broadband subscribers (i.e. 3G and 4G subscribers) reached 1.31 billion, a net increase of 174 million for the whole year, accounting for 83.4 percent of mobile phone subscribers. 5G MACRO BASE STATION PCB value is about 15104 yuan/station, room sub-station PCB value is about 30%-40% of macro station, about 5286 yuan/station. It can be seen that 5G MACRO BASE STATION PCB value is 3.2 times of 4g (4,692 yuan) , a 5g base station PCB single station value as high as 15,000-20,000 yuan, CCL PCB accounted for about 35% of the cost, single station value is about 0.5-0.7 million yuan. Based on the projected rate of construction of Hongji station and substations in 2018-2022, the incremental market potential of a single year 5G base station (assuming that the single station PCB & CCL VALUE DECREASES BY 6% per year as productivity increases) can be roughly calculated. 2022-2023 is the peak year for 5G base station construction, and the annual demand for PCB is about 21-24 billion yuan (50%-60% of which is Chinese mainland) , compared with 8 billion yuan in the 4G era, which is nearly three times the increase. CORRESPONDING CCL (most are high frequency high speed CCL) market space of about 8 billion yuan (of which about 50%-60% Chinese mainland) , corresponding 4G era of 2.5 billion yuan is nearly three times the increase.

(1)Copper demand calculation in the production cost of CCL, direct raw materials accounted for 80%-90% , and in the three main raw materials of copper clad laminate copper foil, glass fiber cloth, resin, copper foil accounted for 30% (thick CCL) and 50% (thin CCL) , respectively, cOMPREHENSIVE CALCULATION OF COPPER FOIL IN CCL operating costs of about 40% .

(2) Verify the global scope, CCL production capacity is gradually moving to China, while the downstream PCB production capacity is also moving to China, these factors have expanded the size of the domestic CCL market. According to statistics, China's output of various types of copper clad laminate increased from 64.5 million square meters in 2000 to 592.57 million square meters in 2018.

CCL COPPER FOIL consumption = CCL production unit consumption (1 + loss rate). The tentative loss rate is 10% . And according to the output demand of different kinds of CCL in past years, the output of rigid, flexible and metal-based CCL is about 75% : 20% : 5% . Based on the above data, we make the following predictions:

In this paper, the rigid copper clad laminates are calculated on the average of 50% for 1 oz laminates, 35% for 1/2 oz laminates and 15% for 1/4 oz laminates, all the flexible copper clad laminates are calculated on the average of 1/2 Oz laminates and all the metal base copper clad laminates are calculated on the average of 1 oz. The consumption of copper foil for 5G base station copper clad laminate is about 7%-8% , 7.5% in this paper

Since the verification method is based on the total output of CCL in China, it is concluded that the copper demand for CCL at 5G base station may have some errors, but it does not change the overall order of magnitude.

7. Conclusion

According to our estimation, the copper consumption of CCL for 5G base stations in 2020 is about 20,000 tons, which is negligible compared with the total copper demand of more than 10 million tons per year in China. PS: due to the current market for base station field copper reference less, our calculation will inevitably have gaps. 

Source: Tianfeng Futures Research Institute, EDITOR IN CHARGE: Zhang Yinni

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