The Localization Of Silicon Wafer Manufacturing Will Become The Next Focus Of China's Semiconductor Industry

Silicon wafers have maintained a growth momentum since 2016, mainly  driven by end-market demands such as smartphones and automotive  electronics, as well as the conservative expansion of mainstream silicon  wafer manufacturers.


According to the "First Financial" report of Shanghai, Ningxia Yinhe  Semiconductor Technology Co., Ltd. has invested a total of 1.6 billion  yuan and started on March 18, 2018 in the Yinchuan Economic and  Technological Development Zone.


According to reports, the project symbolizes that the "China Core" continues to expand into high-end areas. After the completion of the project, it will produce 12 wafers per  year and can produce 4.2 million 8-inch wafers and 2.4 million silicon  wafers.


At  present, the mainstream semiconductor-level silicon wafer market is  dominated by Japan, Taiwan, Germany, and South Korea, and its  pre-control sales account for 92% of the global total. This contradiction between supply and demand and the market of  oligopoly, the contradiction between supply and demand is outstanding,  and it will force localization of silicon wafers.


Silicon wafers continue to rise, highlighting the urgency of domestic silicon wafer manufacturing in China


Silicon wafers have maintained a growth momentum since 2016, mainly  driven by end-market demands such as smartphones and automotive  electronics, as well as the conservative expansion of mainstream silicon  wafer manufacturers.


Since 2016, China has actively expanded its factories. By the end of 2018, the production capacity of these new plants will be gradually opened or trial-produced. However, the price increase in the blank silicon market will not only increase the development cost, but also very likely. Affecting chip development progress is undoubtedly a big problem for small-capacity manufacturers. It is not difficult to infer that the next step in China's  semiconductor industry will be the localization of silicon wafer  manufacturing.


Silicon wafers are difficult to obtain mainstream silicon  certification, and it is necessary to rely on local Chinese foundries to  help establish them.


Blank silicon accounts for less than 5% of the cost of foundry, but its importance is unparalleled. Plus  silicon certification usually takes one year, while mainstream silicon  customers (IDM, Foundry, etc.) choose silicon suppliers. After the specification is confirmed, even if the price rises reasonably, it is not easy to replace the silicon supplier. This is especially true for customers with more advanced process capabilities.


Therefore,  it is difficult for Chinese manufacturers to independently develop the  silicon manufacturing industry to obtain certification from major  manufacturers. It must be assisted by local foundries in China, such as SMIC, TSMC and Hejian and other advanced process manufacturers. Assist Chinese wafer manufacturing industry in gaining certification through preferential or supporting policies.