Chip manufacturing, gold is in urgent demand: soaring prices reflect supply chain challenges

1. Skyrocketing Gold Prices: A Tsunami of Hidden Costs for Semiconductors

• Price status: In April 2025, international spot gold broke throughUS$3400-3500/oz., a record high.
• direct impact：
  • Gold Bumping: Gold accounts for material cost70%+, is the mainstream packaging process for LCD/OLED driver ICs.
  • gold wire bonding: Accounting for high-end packaging costs30%+, the only choice for automotive specifications/RF/AI chips.
  • conduction effect: Qibang, Nanmao and other packaging and testing factoriesBe the first to raise prices, the gross profit margin has declined due to the decline in gold pricesover 4 percentage points。

2. The role of gold in chips (irreplaceable)

1. Wire Bonding

• form:Diameter20-25μmGold strands (10 times thinner than hair).
• function: Chip Pad ↔ Electrical bridge for external pins.
• irreplaceability：
  • Extremely stable: Anti-oxidation, anti-corrosion, and does not fail at high temperatures.
  • High reliability: Automotive regulations, military industry, medical, high frequency radio frequencyonly option。
  • Electromigration resistance:Pure gold wire threshold2×10⁵ A/cm², is bare copper1.7 times。

2. Gold Bumping

• Application: Driver IC, sensor, radio frequency chipFlip chip packaging。
• cost ratio：Material costGold accounts for 70%+; Manufacturing cost ratio48%-51%。
• influence: Driver IC packaging and testing prices increased5%-12%, and ultimately transmitted to panels, mobile phones, TVs and other terminals.

3. Gold plating layer and electrode

• Purpose: Pad, lead frame, contact pointelectroplated gold。
• value: Anti-oxidation, reduce contact resistance, improve signal integrity, extend life.

4. Special high-end applications

• EUV lithography mask: Gold thin film to 13.5nm lightHigh absorption/high reflection。
• RF MEMS switch: Gold plating boostAir tight, corrosion resistant, high frequency performance。
• High temperature / EMI resistant: Military industry, oil exploration, aerospaceextreme environmentEssential.

3. Industry impact: rising costs, squeezed profits, chain reactions

1. Packaging and testing factory: Profits are eaten up

• Qibang, Nanmao: gross profit margin in 2024 **-4pct+; From Q2 2025Price increases across the board **.
• Small and medium-sized factories:No bargaining rights, forced to digest internally, gross profit margin **-6~-9pct**.

2. Design/Terminal: Difficult to pass on costs

• Driver IC, automotive MCU, radio frequency chip:BOM cost + 3%-8%。
• Terminals: panels, mobile phones, automotive electronicsPassive price increase, competitiveness is under pressure.

3. Structural differentiation

• ✅ High gross profit areas(AI/HBM/vehicle regulations): Costs can be passed on and the impact is limited.
• ❌ Low gross profit areas(Consumer DDIC/General Purpose MCU):Profits are broken down, small and medium-sized factories clear.

4. Industry response: technology substitution + supply chain reconstruction (three paths)

1. Material substitution (the most mainstream)

• Copper wire / alloy wireAlternative gold wire:
  • CostOnly gold wire 1/5~1/10, the conductivity is close to.
  • Applicable: consumer electronics, mid- to low-end MCUs, non-automotive specifications (the proportion has reached48%）。
  • Restrictions: Vehicle Specifications/High Frequency/High Temperatureirreplaceable。
• **Nickel Palladium (ENEPIG)** Alternative to Pure Gold:
  • The amount of gold used is **-60%~-80%**, and the reliability is close to pure gold.
  • Already inMid and low-end driver IC, CISLarge-scale application.

2. Process reduction (design optimization)

• Bump shrinkage / spacing enlargement:Single chipGold usage - 20%~-30%。
• Gold-free packaging(Cu Pillar+Solder): Advanced process (7nm and below)Gradually de-financing。

3. Supply chain price locking

• Long order price lock(3-6 months): Sealing and testing plants and gold mines/refineriesLock in gold price。
• Hedging: Use gold futuresHedging volatility risk。

5. Trends and Outlook

1. Long-term reinforcement is just needed
   • AI/automotive regulations/advanced processesIncrease in gold consumption: 3nm compared to 5nm**+15%;HBM / high-end AI chipGold thread usage + 20%+**.
   • Annual global chip consumption200-300 tons, accounting for funds spent on science and technology90%+。
2. Price pressure continues
   • Geopolitics, central bank gold purchase, AI demand supportgold price high。
   • 2025-2027: Gold bump/gold wire costAverage annual +8%~+15%。
3. Restructuring the pattern
   • Domestic substitution accelerates: Domestic gold salt, gold wire, electroplating solutionShare increase(Such as Guanghua Technology, Beijing Dabo).
   • technological differentiation: High-end persistenceAll-gold plan;Mid and low-endComprehensive de-goldization。

Summary