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- Resin is a critical component in the manufacturing of printed circuit boards, which are the nervous system of every modern device, and when board costs spike, the pain moves fast through phones, laptops, wearables, gaming consoles, routers, and AI servers.
- The Jubail petrochemical and industrial complex in Saudi Arabia is offline, knocking out a key world reservoir of resin, and its operational status remains in flux and subject to what could be a lengthy restart process due to the Strait of Hormuz and other war-related issues.
- There are few resin alternatives, not enough production of the substance in the U.S., and supply chain experts predict that by the fall consumers should expect prices on products like smartphones to rise.
Computer chips on a circuit board.Bloomberg | Bloomberg | Getty Images
Anyone with evergreens in their yard probably knows the familiar feeling of putting their hand on the trunk and coming away with a sticky film on their fingers. This sticky stuff is better known as resin. Under the right conditions, tree resin hardens. Humans, like with so many natural substances, realized that resin could be made synthetically with a soup of petrochemicals. Synthetic versions harden even more into a durable, heat-resistant material used in everything from adhesives and coatings to plastics and electronics. Resin is a critical component in the manufacturing of printed circuit boards, which are used in everything from smartphones to computers, appliances, and autos.
When the Jubail petrochemical and industrial complex in Saudi Arabia was struck by Iranian missiles on April 6 and April 7, it was the final blow in a convergence of factors — geopolitical, financial, physical — that knocked out a key world reservoir of resin, leaving the crucial component for circuit boards in short supply. The plants had already shut down at the end of March as it became clear transit through the Strait of Hormuz was untenable during the conflict, and it is still not back online.
There is little public information on the exact status of the Jubail complex today, though Dow CEO Jim Fittering (Dow has a joint venture with Saudi Aramco at Jubail) said on his company’s April 23 earnings call that it continues to guide to a “275 day-plus” process for reopening the Strait of Hormuz and getting supply chains back to normal. The actual repairs needed at the complex seem less critical, based on his comments, than the broader logistics situation. “I think a lot of that is going to be able to be repaired within that time frame. … just talking with our partners, I think they are actively working on repairs, and I don’t hear anything from them that leads me to believe it’s going to extend longer than this duration of this logistics constraint,” Fittering said.
But experts say a resin stoppage extending into the autumn, within that 275-day time frame, would begin to inflict price pain on consumers for some electronics.
According to the April producer price index data, plastic resins and materials were among the contributors driving a 9.4% annual increase in processed goods prices — the steepest rise in over three years.
CNBC was recently taken on a rare tour of a U.S.-based PCB maker TTM’s facilities that highlighted the fragile supply chain that goes into making the computer components. The report noted that back in 2000, 30% of PCBs were manufactured in the U.S. Today, it stands at 4%, with China being the world’s leader in production.
Whether the PCBs are made in the U.S. or China, the resin still comes from the same sources.
Nvidia supplier Victory Giant in China, one of the world’s largest PCB makers, warned that the Middle East conflict could push up prices of key ingredients copper and resin. Printed circuit board (PCB) prices rose by up to 40 percent from March to April, according to a Goldman Sachs note cited by Reuters. TTM, which has seen its stock price rise over 400% in the past year, told CNBC that it’s increasing prices by between 5 percent and 25 percent.
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Mark Vena, CEO and principal analyst at SmartTech Research, said that consumers will feel the pricing pain soon, but not necessarily hear about resin at the mall.
“In all probability, consumers probably will not hear ‘PPE resin shortage’ at the Apple Store, but they may feel it in higher prices, longer repair times, tighter launch inventory, and fewer discounts,” Vena said. Printed circuit boards are the nervous system of every modern device, and when board costs spike, the pain moves fast through phones, laptops, wearables, gaming consoles, routers, and AI servers.
“I would expect upward pricing pressure across premium electronics, but not necessarily a clean ‘resin surcharge’ on the next iPhone,” Vena said.
Apple and the supply chain economics inside the smartphone
Apple is better insulated than most companies because it has massive purchasing power, long-term supplier agreements, sophisticated forecasting, and the ability to redesign around constraints faster than smaller players. “But insulated does not mean immune, because every iPhone still depends on high-reliability circuit boards and the same global materials web that everyone else uses,” Vena said. “Apple can move the pain around, but it cannot make a concentrated petrochemical bottleneck disappear,” he added.
Manufacturers may absorb some of the hit, led by Apple, and make up the increased cost elsewhere, such as slimmer promotions, higher storage costs, and also pushing consumers toward more expensive configurations rather than headlining a dramatic base price increase. But it is a niche of the market where Apple, Nvidia, Google and everyone else are competing for PCB-grade glass cloth from a single supplier.
According to Vena, many companies have less room in their economic model to take the hit than Apple. “The bigger near-term squeeze may show up first in lower-margin devices like PCs, accessories, gaming hardware, routers, and midrange Android phones, where manufacturers have less room to eat a 40 percent PCB shock,” he said.
For all smartphone makers, the cost increase may be felt hardest in a foldable smartphone, Vena said. There are reports Apple may enter that market later in the year, though potential delays in an anticipated September 2026 release have been reported.
Thad Hwang, founder and CEO of Goji Mobile, said smartphones won’t be seeing a price increase in the next couple of months, especially when it comes to flagship phones such as the iPhone 17 and Samsung Galaxy S26 series. “The retail prices of these phones are well known and inventory is usually well stocked,” he said, adding that the longer-term effects of semiconductor manufacturing disruptions and supply chain instability could hit in the autumn.
Supply chain expert and Wichita State University professor Usha Haley said the Jubail complex in Saudi Arabia supplied about 70 percent of the world’s high-purity polyphenylene ether resin. “Production has now come to a standstill and no alternative supplier exists to fill the gap. PCB prices have risen 40 percent in a month, and lead times for epoxy-resin inputs have expanded from three weeks to fifteen,” Haley said.
Resin replacements for high-end tech don’t exist
There aren’t ready-made replacements for resin, although industries are exploring alternatives.
High-purity PPE resin is used because it delivers the electrical, thermal, and reliability characteristics needed in advanced PCBs, especially where signal integrity matters. Substitutes may work in some lower-end electronics, but for premium smartphones, RF components, AI servers, and automotive electronics, any change in material means requalification, redesign, testing, and time.
“This is not like swapping one screw for another,” Vena said.
Engineers may be able to shift to PTFE or epoxy-based laminates for lower-frequency applications. But this shortage, on top of memory-price increases and tariffs, will probably raise the price of electronic devices to the highest level in a decade by the fall, the supply chain experts said.
Advocates for resin and other plastics point to the supply disruptions as added impetus for more onshoring of plastics production. The Plastics Industry Association, the leading trade group for the industry, said it is monitoring the situation closely.
“What’s happening right now underscores the importance of building resilient supply networks that support American manufacturers, businesses, and the consumers who depend on plastic products every day,” said Matt Seaholm, president and CEO of the trade group, while also noting that the current resin supply chain is moving. “Global supply disruptions affect every industry, and plastics are no exception. The U.S. has a strong domestic manufacturing and materials base that helps keep resin supply chains moving during periods of uncertainty,” Seaholm said.
Sridhar Tayur, professor of operations management at Carnegie Mellon University and a supply chain specialist, says the U.S. doesn’t have the manufacturing capacity to replace the lost resin, and that the skills have gone elsewhere — and that leaders don’t pay attention until a crisis is already occurring, as is the case now.
While larger companies are better positioned, he said even they will begin to feel the resin pinch if the shortage isn’t alleviated soon. “Suddenly, people are going to be drawing down on the inventory they have,” Tayur said.
If the plant in Saudi Arabia stays offline for another couple of months, that is when the problems will start. “The situation will affect data centers, routers, and high-end 5G phones — this is where the type of resin used matters most,” Tayur said. The impact will surprise most consumers, and those looking at higher-end phones may opt to delay purchases because of availability or prices.
For Apple and other electronics manufacturers, “there’s not much they can do about shortage, if it’s just not there,” Tayur said.
—CNBC’s Katie Tarasov contributed to this report.
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