Lotte Energy Materials will invest about 50 billion won to expand circuit foil production capacity for AI data centres. The investment will target facility expansion at its Iksan plant in North Jeolla Province, the only circuit foil production base in South Korea. The company aims to raise annual maximum circuit foil capacity to 16,000 tons by 2027. It said on April 28 the decision is a pre-emptive investment made amid an industry-wide slowdown in the copper foil sector due to a chasm, aiming at both an earnings recovery and market expansion.

The investment is driven by growth in the AI data centre and network equipment markets. As customer demand for HVLP (hyper very low profile) copper foil, suitable for high-speed signal transmission, surges, customers are moving to secure inventories in advance. In printed circuit boards (PCBs), HVLP copper foil is drawing attention because it helps reduce signal loss in high-frequency environments.

The company is currently supplying circuit foil from its Iksan plant that meets performance, reliability, mass-production and supply stability requirements. It said the investment will help complete in South Korea every stage of the materials industry value chain from electrical copper foil (Elecfoil) to copper clad laminate (CCL), PCB and modules. Circuit foil is a type of copper foil used to form wiring patterns on PCBs and is mainly used for boards for servers and communications equipment that require high-frequency characteristics.

In March, it signed a memorandum of understanding with Doosan Electronics BG, which has copper clad laminate technology, to cooperate on development evaluation and supply of copper foil needed to produce high-performance PCBs for AI data centres and network equipment. It is part of a strategy to strengthen cooperation with customers and seek supply-chain stabilisation.

CEO Yeon-seop Kim (김연섭) said, "To secure future competitiveness and restore earnings, we made a careful decision on this investment." He said, "We will further solidify customer trust by securing core materials technology for the AI and network era, and by stabilising quality and supply through expanded production capacity."