It is understood that from the beginning of 2017, the supply of silicon wafers is in short supply, pushing up the overall offer price by about 20%. The main reasons for the increase in silicon wafer prices are reflected in two aspects: the Internet of Things, the Internet of Things, storage, AI, and bits. The explosion of applications such as coins boosted demand for semiconductors. On the other hand, the top five global manufacturers did not plan to expand their production capacity. This caused the market conditions of silicon wafers to shift from overproduction to supply shortages and drastically increase prices.
It is worth noting that due to the quarterly price surge of silicon wafers, the foundry's gross profit margin will be affected. Among them, TSMC previously stated that due to the signing of the annual contract, the price of silicon wafers will be affected in 2017. Small, about 0.2% of the gross profit margin, but the price will continue to rise in 2018, and the impact may increase to 0.5~1 percentage point. The market expects that due to the signing of the long-term contract, the major manufacturers will have less impact on the current price increase, but will re-in 2019. After negotiating, the gross profit margin loss will probably increase, while the second-line factories GlobalFoundries, the world's most advanced, UMC, SMIC, and the mainland Yangtze River Storage and other manufacturers have exceeded the expected level of risk.
New wafer fabs in mainland China will boost demand for silicon wafers
At present, in the semiconductor silicon wafer market, foreign giants occupy a major market share. Among them, including Japan's Shin-etsu Semiconductor, Japan's SUMCO, Taiwan Universal Crystal, Germany's Silitronic and South Korea's LG, including the world's top five Manufacturers occupy 90% of silicon wafer market share.
SUMCO, the world’s second-largest silicon wafer maker, previously stated that in the 12-inch silicon wafer segment, prices are expected to rebound by approximately 20% as expected in 2018 (Q10 prices will be higher than 2016 Q4 in 2018). 40%), and it is estimated that the price will continue to rise in 2019. The current customer's concern is to ensure that the required quantity can be obtained, and consultations on contracts after 2021 have begun.
In the 8-inch segment, the increase in supply is limited, and in the future there will be a tight supply and demand situation for a long period of time. Customers are more concerned with purchasing 8-inch silicon wafers than with 12-inch products. In the 6-inch segment, the current supply shortage situation appears. Although prices have risen, the long-term outlook is uncertain.
It is worth mentioning that, thanks to the continuous price increase trend of silicon wafers, the performance of TAICO's stake in Taiwan Sembcorp is very bright. It is understood that Taiwan Seiketsu was established in 1995 and is a joint venture between Formosa Plastics and SUMCO. The stocks were 38% and 46.95%, respectively, and they mainly produced 8 wafers and 12 wafers, accounting for 40% and 60% of the revenue respectively. The customer base was wafer foundry and memory factories.
At the seminar held by Taiwan Sembcorp, Zhao Rongxiang, deputy general manager, said that at present, Taiwan Seiketsu's monthly production capacity is 280,000 for December, and 320,000 for August. The demand for silicon wafers continues to thrive. The bottleneck is to increase production efficiency. It is estimated that there will be double-digit growth in the quotation in 2018. The supply and demand will be tight until 2020, and prices will rise all the way.
Zhao Rongxiang further pointed out that the visibility of Taiwan Seiketsu's orders has reached 2020, and that the major kinetic energy comes from the newly built wafer fabs in the mainland, which will drive the demand for silicon wafers to increase. It is expected that the demand for 2017-2020 will increase by 1.35. Times; The memory factory, currently undergoing expansion includes: Hynix expands 150,000-month production capacity in Wuxi, while Samsung expands monthly production capacity of 100,000 units in Xi’an, and Hefei’s Ruili will also have new production capacity. In addition, Fujian Jinhua and Wuhan Yangtze River Storage are slower than expected, but are affected by the Sino-US trade war. Mainland China has accelerated the development of semiconductors. Jinhua and Changjiang Storage in Fujian have accelerated production and will have production capacity of 4,000 to 5,000 in the future. Move toward 10,000.
Domestic 12-inch, 8-inch wafer production capacity
Wafers are the most important upstream raw materials for wafer fabs. It can be said that upstream silicon wafer materials are controlled by people, and it has become an impetus for industrial development in Mainland China, which has rapidly developed the entire IC industry.
According to the report of China Merchants Securities, in terms of 12-inch wafers, as of November 2017, the demand for 12-inch silicon wafers in China is 450,000 (including Samsung Xian, SK Hynix Wuxi, Intel Dalian, and Core Xiamen). Into the integration of crystallization and integration, TSMC Nanjing and Gexin core Chengdu have been put into production successively, together with Nanjing, Changxin Hefei, and Jinhua integrated three major memory chip factories. It is estimated that by 2020 China's 12-inch wafer monthly demand will be 80- 1 million tablets.
At present, China's 12-inch silicon wafers mainly rely on imports, but the planned monthly production capacity has reached 1.2 million pieces. The follow-up production, such as smooth production, can basically meet domestic demand.
Among them, China Central (002129.SZ) signed "Strategic Cooperation Agreement" with Wuxi City on October 13, 2017 to jointly build a large wafer production and manufacturing project for integrated circuits in Yixing City. The total investment of the project is about 3 billion U.S. dollars. The first phase of the investment was approximately US$1.5 billion; Shanghai Xinsheng (300236.SZ), which is a shareholder of Shanghai Xinsheng, has already achieved bulk supply of blanks, and it also has small batches of samples for sale. The current production capacity is 4-5 million tablets/month. It is expected that the production capacity will reach 100,000 tablets/month in 2018; Chongqing Super Silicon's 12-inch wafer development progress is also relatively smooth.
In terms of 8-inch silicon wafers, as of the end of 2016, China’s total production capacity for 8-inch silicon wafers and epitaxial wafers has a monthly capacity of 233 thousand wafers per month, and the actual capacity utilization rate is less than 50%. The output of 1.2 million 8-inch silicon wafers only meets domestic demand of 10%. From the currently announced capacity, the monthly production capacity of 8-inch silicon wafers has reached 1.4 million, totaling more than 1.6 million wafers, far exceeding our country's The monthly demand for 8-inch silicon wafers is 800,000 tablets.