Gold demand in electronics sector logs double-digit growth
Each of the major electronics fabrication hubs worldwide recorded an increase in gold demand, says WGC
Hyderabad: The Electronics sector, which accounts for the majority of industrial gold demand, registered 13 per cent growth in Q1 2021 year-on-year (y-o-y) to 66.4 tonnes globally. Demand for gold across all major applications in the sector increased from the historic lows recorded in Q1 2020.
The memory sector also maintained steady growth in Q1, recording increased gold demand of 3-6 per cent y-o-y. However, challenges remain from both miniaturisation of chip architecture, which reduces the volume of gold used and the threat of manufacturers switching to silver bonding wire.
Talking about the consumption trend, Somasundaram PR, Managing Director, India, World Gold Council (WGC), told Telangana Today, “Semiconductor, 5G, wireless and other electronic segments have seen strong and consistent growth in the first quarter of 2021, despite large manufacturers in this space looking for an alternative material to reduce the overall cost of the products. The technology sector largely accounts for 300-400 tonnes of gold consumption every year and will continue to grow.”
The Printed Circuit Board sector performed strongly during Q1, showing a rise of 15-18 per cent y-o-y. Each of the major electronics fabrication hubs around the world recorded an increase in gold demand during Q1. Japan, Mainland China & Hong Kong, South Korea and the US recorded an increase of 11.6 per cent, 27.4 per cent, 13.5 per cent and 5.7 per cent, respectively.
Growth in LED gold use between 10 and 13 per cent y-o-y was driven by demand for high-end consumer electronics, such as laptops, tablets and TVs, as well as the recovery in the automotive industry. 3D sensors within mobile and artificial intelligence devices also provided push, along with the growing use of UV-LEDs within the biomedical sector, particularly in bactericidal wearable devices.
Somasundaram said, “5G is also becoming increasingly common in handheld devices. These devices require an increased number of power amplifiers, which depend on gold for their reliable operation. In future, 3D sensing chips in smartphones and partially-autonomous automotive systems will further support gold demand in the wireless sector.”
Online jewellery demand
He added, “Digital channels are going to increase the gold demand, particularly in the jewellery space. There will be an enormous push in the use of technology. Jewellery companies and IT companies are already working together to bring 3D and innovation. Technology is also actively being integrated with handcrafted jewellery.”
Online purchase of gold is also set to increase in future. Micro savings in gold will also pick up. Gold buying predominantly has been dependent on the whole buying experience of customers at physical stores, but technology is certainly going to drive demand, noted Somasundaram.
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