Let’s talk about something that rarely pops up in discussions about Huang Jiaozhu and the Nvidia empire.
Nvidia's fate could very well be in the hands of a company that sells MSG.
Ajinomoto.
Yeah, that Japanese company that peddles flavoring.
But it has another role, controlling a massive chunk of the global supply of critical materials for high-end chip packaging, namely ABF (Ajinomoto Build-up Film). ABF is the insulating film in AI GPU packaging substrates; without it, high-density circuits can short out and cross-talk, rendering even the most advanced chips unstable.
Since its adoption by major semiconductor manufacturers in 1999, ABF has become a key material for nearly all high-performance CPUs.
Why does it hold the chokehold on AI chips?
Because you can't just sell an AI GPU as a bare chip. The chip needs to connect to the motherboard, power, HBM, and I/O through packaging substrates. The more high-end the GPU, the denser the circuits, the more layers, and the larger the area, which means a stronger reliance on ABF substrates. Industry reports commonly cite that Ajinomoto holds a staggering 90%-95%+ market share in the ABF film market, making it a de facto single-source supplier.
Reuters Breakingviews also noted that Palliser estimates Ajinomoto has about 95% of the ABF market, with this material being used in advanced semiconductor substrates manufactured by TSMC, Samsung, and others.
Nvidia defines AI computing power.
TSMC manufactures AI chips.
SK Hynix feeds it HBM.
But Ajinomoto decides whether it can be packaged on a large scale.
The most surreal supply chain story of the 21st century:
A MSG company has a stranglehold on the global AI chip market.
Nvidia's fate could very well be in the hands of a company that sells MSG.
Ajinomoto.
Yeah, that Japanese company that peddles flavoring.
But it has another role, controlling a massive chunk of the global supply of critical materials for high-end chip packaging, namely ABF (Ajinomoto Build-up Film). ABF is the insulating film in AI GPU packaging substrates; without it, high-density circuits can short out and cross-talk, rendering even the most advanced chips unstable.
Since its adoption by major semiconductor manufacturers in 1999, ABF has become a key material for nearly all high-performance CPUs.
Why does it hold the chokehold on AI chips?
Because you can't just sell an AI GPU as a bare chip. The chip needs to connect to the motherboard, power, HBM, and I/O through packaging substrates. The more high-end the GPU, the denser the circuits, the more layers, and the larger the area, which means a stronger reliance on ABF substrates. Industry reports commonly cite that Ajinomoto holds a staggering 90%-95%+ market share in the ABF film market, making it a de facto single-source supplier.
Reuters Breakingviews also noted that Palliser estimates Ajinomoto has about 95% of the ABF market, with this material being used in advanced semiconductor substrates manufactured by TSMC, Samsung, and others.
Nvidia defines AI computing power.
TSMC manufactures AI chips.
SK Hynix feeds it HBM.
But Ajinomoto decides whether it can be packaged on a large scale.
The most surreal supply chain story of the 21st century:
A MSG company has a stranglehold on the global AI chip market.