Accounting for 95% of the global market share, Ajinomoto will cut its supply of ABF films to mainland China by 30%.

In August 2026, industry chain sources indicate that Ajinomoto, the global leader in ABF films, has officially notified mainland Chinese clients that it will cut ABF film supply by 30%.

As a core material for high-end chip packaging, Ajinomoto holds over 95% of the global ABF film market share. This supply contraction has triggered high attention within the domestic IC substrate and high-end computing chip packaging industry chains.

ABF film, short for Ajinomoto Build-up Film, is a key insulating material for IC substrates used in high-end CPUs, GPUs, FPGAs, ASICs, and other chips, with material costs accounting for approximately 30% of the total substrate cost.

The material originated from the research and development of by-products from Ajinomoto's MSG production in the 1990s. It achieved industrialization through cooperation with Intel in 1996 and realized mass production in 1999. Over the past three decades, the company has built extremely high industry barriers through dense patent moats and a long-term supply chain certification system, maintaining a near-monopoly market structure for a long time.

Looking at the current status of the supply side, Ajinomoto's monthly production capacity for ABF films exceeded 2 million square meters in the second quarter of 2026, and current capacity is already running at full load.

According to public plans, the company's new round of expansion plans will not launch until 2028, and the third factory is expected to be built and put into production only by 2032, indicating a rigid bottleneck in medium-to-long-term capacity. Against the backdrop of the continuous explosion of global AI computing demand and capacity growth lagging behind demand, Ajinomoto has chosen to prioritize guaranteeing supply for the Japanese domestic market and overseas core clients, compressing the supply quota for the mainland Chinese market.

The supply-demand imbalance is continuing to ferment.

Industry forecast data shows that the global supply-demand gap for ABF substrates will reach 10% in the second half of 2026, expand to 21% in 2027, and further climb to 42% in 2028. Morgan Stanley recently upgraded its industry outlook, raising the forecast for the global high-end ABF substrate supply-demand gap in 2030 from 15% to 22%.

Tightening supply directly brings dual pressures on prices and delivery cycles.

Market sources indicate that the delivery cycle for ABF films has lengthened to over half a year. Ajinomoto simultaneously notified clients that a new pricing system will be implemented in the third quarter of 2026, with maximum product price increases reaching up to 30%.

The pressure on the domestic industry chain is particularly evident.

Currently, the mainland China's self-sufficiency rate for ABF films is less than 5%. Local leading IC substrate manufacturers such as Shennan Circuits, Xingsen Technology, and Shenghong Electronic are highly dependent on imported materials from Ajinomoto. A 30% supply cut means that domestic substrate enterprises will face the direct risk of raw material shortages, and the release of production capacity for high-end ABF substrates will be constrained. Rising raw material prices combined with insufficient supply are elevating costs for upstream and downstream enterprises, squeezing profit margins, and indirectly affecting the development pace of the domestic high-end computing chip packaging industry.

Amidst the crisis, a window of opportunity has also opened for domestic substitution.

Multiple domestic material companies are continuously laying out the research, development, and validation of new build-up films benchmarked against ABF films: Huazheng New Materials is advancing the R&D and mass production of CBF films, Lianhua Holding is laying out NBF films, Hongchang Electronics is developing GBF films, and Shengyi Technology is making efforts in ABF-like materials. However, industry insiders objectively stated that domestic materials still need to continuously pass long-term reliability certifications by downstream substrate factories and packaging and testing companies, and comprehensive large-scale substitution will still take time.

Industry analysis believes that in the short term, domestic substrate manufacturers may cope with the raw material supply shock by optimizing order structures and seeking diversified procurement channels; in the medium and long term, the demand for supply chain security will accelerate the promotion of R&D investment, production line construction, and downstream validation processes for domestic build-up insulating materials. Changes in the ABF film supply pattern will also force continuous breakthroughs in key upstream materials for domestic semiconductor packaging, reducing the risk of reliance on a single overseas material manufacturer.