Research institutions: The planned 12-inch production capacity exceeds 60 million pieces per year, and the short-term supply of domestic large silicon wafers is limited.

According to the analysis of JW Insights:

– Since 2017, large-scale silicon wafer projects have been signed and implemented. Domestically, more than 20 large-scale silicon wafer projects have been implemented, and some planned projects have been put on hold during the promotion process, with a hold-up rate exceeding 25%.

– With the policy dividend, market demand and localization boom, domestic manufacturers have gradually started. The planned production capacity of 12-inch semiconductor silicon wafers has exceeded 80 million pieces per year. However, apart from the shelving of the project, the 12-inch silicon wafer production capacity of the large silicon wafer factory under construction in China exceeds 60 million pieces per year.

– Currently, there are 12-inch projects under construction in China, and the planned annual production capacity has exceeded 60 million pieces per year. However, the construction progress of domestic silicon wafer projects is still relatively slow, and the supply of silicon wafers cannot be greatly increased in the short term.

Silicon wafers are the most important basic raw materials for semiconductor chip manufacturing. With the surge in demand for various semiconductor applications, as the engine of digital transformation and new technologies, the market shipments and demand for silicon wafers are increasing. Since 2017, domestic 8/12-inch large-scale silicon wafer projects have continued to be implemented. With the steady progress of projects such as Shanghai Xinsheng, Chaosilicon, Zhongxin Wafer, and Shandong Youyan, domestic semiconductor large-scale silicon wafers have embarked on the road of catching up. At present, the planned production capacity of 12-inch large silicon wafer projects under construction across the country has exceeded 60 million wafers per year.

The market demand for large silicon wafers continues to increase

Silicon materials are still the mainstream semiconductor materials, and silicon wafers account for the largest proportion of wafer manufacturing materials. With the improvement of monocrystalline silicon manufacturing technology, the size of silicon wafers is gradually increasing. Wafer size from the initial 2 inches, to 4 inches, 5 inches, 6 inches, 8 inches, and then to 12 inches, the size of the silicon wafer continues to increase.

Globally, the market share of 12-inch silicon wafers has gradually increased since 2000, and exceeded the market share of 8-inch silicon wafers for the first time in 2008.

At present, semiconductor silicon wafers are constantly developing in the direction of large size. This is mainly due to cost and market drivers. The larger the diameter of the semiconductor wafer, the greater the number of chips that can be fabricated on a single wafer, the smaller the loss at the edge of the wafer, and the lower the cost per chip. For example, under the same process conditions, the usable area of ​​a 300mm (ie 12-inch) semiconductor silicon wafer is more than twice that of a 200mm (ie, 8-inch) silicon wafer, and the usable rate (measures the number of chips that can be produced per unit wafer) index) is about 2.5 times that of a 200mm silicon wafer.

Data source: SEMI, 2022

According to data released by SEMI, global silicon wafer area shipments will increase by 14% in 2021, while silicon wafer revenue will increase by 13% compared with 2020, exceeding $12 billion, reaching a record high. Benefiting from the continuous expansion of downstream wafer production capacity under the tight global production capacity, the global semiconductor wafer market is booming.

From a global perspective, with the rise in demand for 12-inch and 8-inch wafers, the demand for silicon wafers is further generated. According to the global 12-inch wafer demand forecast data released by SUMCO, it will reach 9.1 million wafers per month by 2025. The terminal application with the largest demand is smartphones, followed by data centers, PCs/tablets, and automobiles. In addition, Demand for 12-inch wafers is growing fastest in data centers and automobiles. In addition, 8-inch wafer manufacturing has a relatively mature special process, and the expansion of 8-inch wafer fabs will increase the demand for 8-inch silicon wafers. Therefore, the global demand for silicon wafers will further increase.

For the Chinese market, along with factors such as the cost of production factors and the impact of cyclical fluctuations in the semiconductor industry, the proportion of China’s semiconductor market in the global market has continued to increase, which has prompted the demand for large silicon wafers to continue to improve. JW Insights believes that , With the strong support of national policies and the continuous improvement of chip manufacturing capacity in mainland China, and the continuous expansion of chip manufacturing companies in mainland China such as SMIC and Hua Hong, the technical level of Chinese semiconductor companies will be further improved, and the market share will be further expanded. The demand for domestic semiconductor wafers will continue to grow.

According to IC Insights data, the year-on-year growth rate of the global foundry market will reach 26% in 2021, achieving another new high after the 21% increase in 2020. In 2022, the global foundry market will grow by 20% to reach US$132.1 billion. The share of mainland Chinese companies in the global pure-play foundry market increased by 0.9 percentage points from 7.6% in 2021 to 8.5%, approaching the 10% mark.

The rise of large domestic silicon wafer manufacturers

As a key material for chip manufacturing, semiconductor silicon wafers present an oligopolistic market structure as a whole. At present, about 90% of the global silicon wafer market is still occupied by international giants such as Japan’s Shin-Etsu Chemical, SUMCO, China’s Taiwan Global Wafer, and Germany’s Siltronic, and the localization rate is still low.

Semiconductor wafer companies in mainland China mainly produce semiconductor wafers of 6 inches and below, and only a few companies have the production capacity of 8/12-inch semiconductor wafers. In my country’s semiconductor silicon material products, 6-inch silicon wafers account for about 60%. 8-inch silicon wafers account for about 20%.

Before 2017, almost all 12-inch semiconductor wafers were imported. Later, with policy dividends, market demand and technology accumulation, domestic manufacturers gradually started. In 2018, Shanghai Xinsheng, a subsidiary of Silicon Industry Group, became the first enterprise in mainland China to achieve large-scale sales of 12-inch silicon wafers.

In addition, domestic companies engaged in 8/12-inch large silicon wafer business mainly include Zhongxin Wafer, Jin Ruihong, Zhonghuan Co., Ltd., Shandong Youyan, Zhengzhou Hejing, Ningxia Yinhe, Shanghai Super Silicon, Jiaxing Guojing Semiconductor , Xuzhou Xinjing Semiconductor, etc. In February this year, Leon Micro announced that its subsidiary Jinruihong Microelectronics planned to acquire Jiaxing Guojing.

According to public information, since 2017, large-scale silicon wafer projects have been signed and implemented. Domestically, nearly 20 large-scale silicon wafer projects have been implemented. Among them, the planned production capacity of 12-inch semiconductor silicon wafers has reached nearly 80 million pieces per year.

Benefiting from the advantages of the integrated circuit industry in the Yangtze River Delta, there are more than 5 enterprises in Zhejiang, 3 enterprises in Jiangsu, and 2 enterprises in Shanghai. The number of large silicon wafer enterprises/projects in Jiangsu, Zhejiang and Shanghai and the planned production capacity of 12-inch large silicon wafers All account for more than 50% of the country, occupying “half of the country”.

From the perspective of planned production capacity, the current planned 12-inch production capacity in the Yangtze River Delta region has exceeded half of the country. And some projects are in steady progress, and production capacity supply is also steadily increasing. The implementation of the 2021 National Economic and Social Development Plan and the draft 2022 National Economic and Social Development Plan previously released by Shanghai show that Shanghai has supplied more than 4 million 300mm large silicon wafers.

However, from a national perspective, some planning projects have been put on hold during the promotion process, such as: Chengdu Chaosil was liquidated, and Chongqing Chaosil had no record. The US$3 billion Qi Shi silicon wafer project, Jiangsu Changzhou Ruixinjing project and Sichuan Zigong Jinglue Changfeng project have no follow-up developments, and the shelving rate exceeds 25%. In addition to the shelved projects, the 12-inch silicon wafer production capacity of large domestic silicon wafer factories under construction exceeds 60 million pieces per year.

At present, domestic 12-inch large silicon wafers have made significant breakthroughs in recent years, and they are accelerating breakthroughs in production capacity improvement, positive film sales and customer certification. Taking Shanghai Xinsheng, a representative 12-inch project in China as an example, it has completed the construction of a production capacity of 300,000 wafers per month, or 3.6 million wafers per month, making it a representative 12-inch large silicon wafer factory in China. According to the data disclosed by Zhonghuan, as of the end of 2021, its 12-inch semiconductor silicon wafer production capacity is 170,000 pieces/month, and by the end of 2022, it is expected to have a production capacity of about 300,000-350,000 pieces/month.

On the other hand, the design capacity of many large silicon wafers in China is still a “long-term goal”, and some domestic projects are still in the stage of customer verification and production line construction. However, it takes a certain amount of time from the plan to the release of production capacity. In general, the short-term supply of large silicon wafers in China is limited.

According to JW Insights:

The development of large silicon wafers in China started late, and is actively catching up with the pace of international advanced product development and mass production. At present, the domestic self-supply rate of domestic 8-12-inch large silicon wafers is very low, and it is still facing the situation of being monopolized by large foreign companies. Under the general trend of domestic substitution, domestic 8-12-inch silicon wafers usher in huge opportunities. .

Compared with major international semiconductor silicon wafer suppliers, Chinese mainland semiconductor 8/12-inch silicon wafer companies are relatively weak in technology and have a smaller market share. At present, 12-inch projects are under construction in China, and the planned annual production capacity has exceeded 60 million pieces per year. However, it will take a certain period of time from planning to production capacity release, and it is difficult to increase the supply of silicon wafers significantly in the short term. However, with the support of national policies and funds and the rise in market demand, Chinese companies have successively planned production lines and laid out large semiconductor wafers. With the gradual implementation of production capacity, it can effectively reduce the dependence on imported large silicon wafers.