Glass Fiber Cloth: The Underlying Material Shortage in AI Infrastructure
Capacity constraints are not expected to ease until mid-2027, affecting lead times and costs across the AI server supply chain
The AI infrastructure buildout is often discussed in terms of chips and computing power. But beneath the surface, a set of supply chain bottlenecks is quietly shaping the pace and cost of deployment. Last week, we looked at CPO testing. This week: glass fiber cloth.
The arrival of the Nvidia Rubin generation is reshaping the demand structure for advanced substrate and PCB materials. Compared to its predecessor, the Rubin GPU substrate has seen significant increases in both area and layer count. Furthermore, cableless designs have catalyzed new demand for midplanes and orthogonal backplanes. The introduction of the Rubin LPX rack, a disaggregated rack for inference, has further expanded the overall consumption of high-end glass fiber cloth.
Related report: 2026 Outlook: NVIDIA Rubin Drives New Wave of AI Hardware Upgrades
On the supply side, however, the market faces severe constraints. Nittobo, the leading manufacturer holding approximately 90% market share in T-glass and 60-70% in NER-glass, is not expected to bring new capacity online until mid-2027 at the earliest. Consequently, critical material gaps cannot be filled in the short term. Glass fiber cloth has transitioned from a rarely discussed “supporting role” to a critical bottleneck affecting the lead times and costs of the entire AI server supply chain.
What is Glass Fiber Cloth and Why It Matters
Glass Fiber Cloth is a key raw material for Copper Clad Laminates (CCL), the primary component of PCBs. CCLs are formed by laminating glass fiber cloth, copper foil, and resin under high temperature and pressure, accounting for approximately 19%, 42%, and 26% of the total CCL cost, respectively. High-end CCL is categorized into grades ranging from M6 to M10, based on signal loss (from higher to lower loss).
In a CCL, these three components work together to reduce signal loss and achieve high-speed transmission:
Glass Fiber Cloth: Utilizes Flat Glass Fabric technology and Low-Dk glass materials to narrow the velocity mismatch between glass fiber bundles and resin-filled gaps, thereby reducing signal loss caused by the Glass Weave Skew (GWS) effect, alternately known as the Fiber-Weave Effect (FWE).
Copper Foil: Uses HVLP (Hyper Very Low Profile) copper foil with low surface roughness to create a smoother copper surface, reducing signal loss caused by the Skin Effect.
Resin: Employs Low-Dk resins (such as PTFE, PPO/PPE) to minimize signal loss.
Depending on its Dk value, glass fiber cloth is classified into several grades: E-glass, T-glass (Low CTE), NE-glass (Low Dk), NER-glass (Low Dk2), NEZ-glass, and Q-glass. E-glass is the general-purpose electronic grade, while T-glass (Low CTE), NE-glass (Low Dk), NER-glass (Low Dk2), NEZ-glass, and Q-glass are specialty grades that attain lower Dk values primarily by tuning the SiO₂, Al₂O₃, and B₂O₃ composition.
T-glass (Low CTE) is used in IC substrates for GPUs and ASICs; NE-glass (Low Dk) is used in AI server motherboards and 400G switches; NER-glass (Low Dk2) is used in 800G switches; and NEZ-glass and Q-glass are used in 1.6T switches. As the grade rises, the price per unit area increases several-fold: the average selling price (ASP) of NE-glass (Low Dk) is about 6x that of E-glass, and the ASP of NER-glass (Low Dk2) is about 2.5x that of NE-glass (Low Dk).
For the next-generation Low Dk3 glass fiber cloth, Japan’s leading supplier Nittobo has developed an improved NEZ-glass, scheduled for release in 2027. Other suppliers are instead pursuing Q-glass, made from quartz fiber, to break through Nittobo’s technology barrier.
Q-glass is composed of 99.9% SiO₂, with Dk and CTE values far lower than those of existing glass fiber cloth. However, it faces challenges including very high price and extreme hardness that makes processing difficult. CCL makers are therefore expected to adopt Q-glass only in the early stages; as CCL formulations improve, NEZ-glass is expected to gradually replace Q-glass.
[Editor’s Note] To clarify, the potential transition from Q-glass to NEZ-glass is conditional — it depends on improvements in CCL formulations and Nittobo’s successful commercialization of NEZ-glass by 2027.
AI Is Driving Glass Fiber Cloth Demand on Multiple Fronts
T-glass (Low CTE)
T-glass features a Low CTE characteristic—as low as 2.8 ppm/°C, close to that of silicon (2.6 ppm/°C)—which effectively prevents chip warpage under thermal stress, and is particularly important in advanced packaging with multi-layer stacked structures. As a result, T-glass is used primarily in the substrates of AI chips such as GPUs and ASICs. As AI applications move into deployment, major CSPs are continuing to raise capital expenditure to procure general-purpose GPUs and custom ASICs, driving T-glass demand higher.
AI chip substrates are also growing in both area and layer count. Taking Nvidia GPUs as an example, substrate area has grown from 3,190 mm² in the Hopper series to around 4,780 mm² in the Blackwell series, and is expected to reach 8,000 mm² in the Rubin series, a roughly 2.5x total expansion from Hopper. Layer count has likewise risen from 14L in Hopper to 16L in Blackwell, and is projected to reach 18L in Rubin, a cumulative 30% increase.
Low Dk
Low Dk glass fiber cloth is used mainly in high-speed transmission applications such as AI server motherboards, UBBs, OAMs, switches, and routers. As per-lane rates on the Scale-Up and Scale-Out fabrics of AI servers move to 224 Gbps, the required CCL grade must be upgraded from traditional M7 to M8 or M9, boosting demand for Low Dk2 and Low Dk3 glass fiber cloth.
Furthermore, the layer counts for motherboards in each tray in AI server racks are increasing. During 2024 and 2025, layer counts were roughly 20 to 28, and are expected to reach 24 to 40 during 2026-2027.
To improve downstream assembly yields, Nvidia and AWS have also introduced cableless designs, making chip-to-chip transmission more dependent on high-end CCL and creating additional demand for midplanes and orthogonal backplanes.
Beyond AI servers used for training, disaggregated racks designed for inference have further driven PCB demand. For example, Nvidia announced at GTC in March 2026 the inference-oriented Groq 3 LPX rack, which houses as many as 32 compute trays per rack, further boosting demand for NER-glass (Low Dk2), NEZ-glass, and Q-glass.
Nittobo’s Capacity Bottleneck: Prices, Timelines, and the Second-Source Opening
Japan’s Nittobo is the leading glass fiber cloth supplier, with an integrated yarn-to-cloth production capability and advanced product technology. In Low CTE, Nittobo holds approximately 90% global share in T-glass. In Low Dk, Nittobo has stable mass-production capability for NER-glass (Low Dk2), with a global share of about 60%-70%.
To meet the strong T-glass and NER-glass demand driven by AI, Nittobo announced in August 2025 a plan to triple its T-glass capacity. During 2026-2027, Nittobo plans to invest more than ¥50 billion to significantly expand capacity in Japan and Taiwan. However, newly installed equipment typically requires about six months to reach stable yield, meaning meaningful relief of supply constraints is unlikely before mid-2027.
Because Nittobo holds a near-monopoly in the T-glass market, under severe shortage conditions, Nittobo raised prices across its glass fiber product line by 20% in August 2025, and plans another increase of roughly 20%-30% in April 2026. T-glass price hike will influence the price trends of downstream BT and ABF substrates. The impact is expected to be reflected in BT substrate quotes approximately one quarter after the hike, and in ABF substrates approximately two quarters after the hike.
Nittobo’s supply constraints are pushing downstream manufacturers to seek alternative sources, providing opportunities for second-source suppliers.
Low Dk1: Asahi Kasei, Taiwan Glass, Fulltech Fiber Glass, Taishan Fiberglass, and Hong Ho have entered the market to compete for NE-glass share.
Low Dk3: Suppliers like Asahi Kasei, Shin-Etsu, Glotech, Feilihua, Taishan Fiberglass, and Hong Ho are focusing on Q-glass, collectively capturing the majority share in the early stages of M9-grade CCL deployment.
T-glass: Taiwan Glass, Fulltech Fiber Glass, and Hong Ho have developed corresponding products and passed customer validation.
The high-end glass fiber cloth market is tightening, and understanding the supply chain dynamics matters. For the comprehensive analysis on glass fiber cloth demand, pricing trajectory, and key suppliers, access the full report: 2026 T-Glass Supply Shortages: AI Rack Fiberglass Trend
The AI infrastructure buildout is reshaping supply chains at every layer. Join TrendForce experts and industry leaders at CompuForum 2026 on June 11 in Taipei to explore the strategic shifts ahead. REGISTER NOW.