Issue link: https://iconnect007.uberflip.com/i/1494936
24 PCB007 MAGAZINE I MARCH 2023 Raw materials Goodwin: Look at things that have changed in the market recently. Heavy coppers are now in short supply in Asia. Why? It's simple: e Chinese manufacturers of copper foil have switched their production to batteries because the EV business in Asia is going crazy. I was just asking Fabienne from Circuitfoil about battery foils because I know very little about them. Turns out, they're very easy to make. You don't have to put a treatment on the back; you don't have all these extra processes. She said, "Actually, the plating is the easy part o f t h e t e c h n o l o g y , relatively speaking, and you'll basically do a plat- ing." Morgan: It's just drum state basically. It comes off the drum. Goodwin: is is a beautiful business. It's a large body of business, it's sustainable, it's everything. People don't want to make two- ounce, three-ounce, four-ounce foils, when battery foils are typically 5-micron, 9-micron, 12-micron. Morgan: You get a lot off the drum. Goodwin: A lot off the drum. Any foil goes a long way, or your raw copper goes a long way, unlike with the heavy foils. I was speaking to Jason Chung, our CEO in China, recently, and he said, "Yeah, it's gone crazy, the LMEs jumped by 10%." It's more than 10%. Yesterday, the LME was at $10,500 a ton again already. Months ago, it was $7,500, right? Two years ago, we had yet to break $7,000. e price of copper is only going one way, and that's up. e Shanghai Metal Index is even more inter- esting; copper is $1,000 higher per ton than the LME. Why? ere's currently no scrap copper foil available in China because the infrastruc- well. Sometimes, diversity works. But Ventec has never been a big producer of any one item. I've used the word "niche," but it's not really the right word to use, because there are a range of niches, some of them quite big, and we have a place in many of them. Ventec's strength is in its range. Even during the height of the pan- demic, there were certain products that didn't really suffer at all. We have a war now on European shores. at has, of course, made defense spending increase. We're one of the major suppliers of polyimide in that sector, so that's sort of good for us. Over the last year, I expect you've seen a change in that, Mark; the mar- ket is slightly bigger, but there's no pressure there, as we're dealing with a different kind of product. As soon as you commoditize, you've got a problem. Luckily, Ventec is not a majority commodity business. Goodwin: We have some commodity busi- ness, but it's not a strategic business for us. It allows us to balance our factories so that when we do sell commodities, we're able to position ourselves as the fast turnaround supplier in Asia. I'll say, regarding the fast-turn orders in Asia, 10,000–20,000 sheets, stock panels, our Asia team will turn those around in a few days for people. Again, it's a very service-oriented business at commodity-plus pricing, but if you want to buy your rigid FR-4, you're alway s go ing to f ind s omewhere cheaper than Ventec. Ventec w ill prov ide it to you as par t of a pack age of thing s; we'll pro - vide it to you with service, with reliability of supply chain and quality, but we're never going to be the price leaders in this business. We're not big enough. Morgan: It's not our game, either. Ventec's strength is in its range. Even during the height of the pandemic, there were certain products that didn't really suffer at all.