Semiconductor eco growth in 2021, chips; 26%, equipment;42%, material;15%
Semiconductor industry Association had reported a record semiconductor chip revenue of US$ 555.9 billion in year 2021, a growth of 26.2% compared to 2020. The forecast for 2022 is a growth of 8.8%. This covid, remote working, and Electric Vehicle driven growth has triggered the overall growth of semiconductor supply chain.
The semiconductor equipment market which is directly dependent on semiconductor chip market growth, grows exponentially and falls exponentially in response to the linear growth of chip market. The semiconductor equipment industry body SEMI says Global fab equipment spending for front-end facilities is expected to jump 18% year-over-year (YOY) to an all-time high of US$107 billion in 2022, marking a third consecutive year of growth following a 42% surge in 2021.
“Crossing the $100 billion mark in spending on global fab equipment for the first time is a historic ?milestone for the semiconductor industry,” said Ajit Manocha, president and CEO of SEMI. “This ?significant achievement is a tribute to the relentless drive to add and upgrade capacity to address a diverse range of markets and emerging applications, solidifying expectations for long-term industry growth to enable electronics for the digital world.”
“Global fab equipment spending is forecast to have another healthy year in 2023 and is expected to remain above the $100 billion mark,” said Sanjay Malhotra, vice president of Corporate Marketing and the Market Intelligence Team at SEMI. “We expect global semiconductor capacity to maintain steady growth this year and in 2023.”
TSMC and UMC headquartered Taiwan region increasing investments 56% YoY to US$35 billion, followed by Samsung headquartered Korea at US$26 billion, a 9% rise, and growing newbie in the semiconductor manufacturing China at US$17.5 billion, a 30% drop from its peak last year. Europe/Mideast is forecast to log record high spending of US$9.6 billion this year, and while comparatively smaller, this would represent a staggering growth of 248% YoY. Taiwan, Korea and Southeast Asia are also expected to register record high investments in 2022. In the Americas, the report shows fab equipment spending peaking at US$9.8 billion by 2023, acccording to SEMI.
The SEMI World Fab Forecast report shows the global industry increasing capacity 8% this year after a 7% rise in 2021. Capacity growth is expected to continue increasing, rising 6% in 2023. The fab equipment industry last saw a YoY installed capacity growth rate of 8% in 2010, when it topped 16 million wafers per month (200mm equivalents) – nearly half of the 29 million wafers per month (200mm equivalents) projected for 2023.
Over 83% of equipment spending in 2022 will stem from capacity increases at 150 fabs and production lines, a proportion expected to edge down to 81% next year as 122 known fabs and lines add capacity, as per SEMI.
SEMI says as expected, the foundry sector, with a share of about 50%, will account for the bulk of equipment spending in 2022 and 2023, followed by memory at 35%. The two sectors also represent most of the capacity increases.
The SEMI World Fab Forecast report lists 1,426 facilities and lines globally, including 124 future facilities and lines with various probabilities that are expected to start volume production no sooner than 2022.
The growth of semiconductor chip market also triggers growth of semiconductor materials market, SEMI along with covering semiconductor equipment market, it also studies semiconductor material market. SEMI reported the global semiconductor materials market grew 15.9% to $64.3 billion in revenue in 2021, surpassing the previous market high of $55.5 billion set in 2020.
SEMI reported the Wafer fabrication materials and packaging materials revenues in 2021 totaled $40.4 billion and $23.9 billion, respectively, for year-over-year increases of 15.5% and 16.5%. The silicon, wet chemicals, chemical-mechanical planarization (CMP), and photomask segments showed the strongest growth in the wafer fabrication materials market, while packaging materials market growth was largely driven by the organic substrates, leadframes, and bonding wire segments, as per SEMI.
“The global semiconductor materials market saw exceptional growth in 2021 on the strength of robust secular demand for chips and the industry’s expansion of production capacity,” said Ajit Manocha, president and CEO of SEMI. “All regions registered double-digit or high single-digit growth last year to meet historic demand for electronics as digital transformation continues apace.”
Due to dense location of semiconductor manufacturing, Taiwan, at $14.7 billion, was the world's largest consumer of semiconductor materials on the strength of its foundry capacity and advanced packaging base. China registered the strongest absolute year-over-year growth in 2021 to rank second, while Korea remained the third largest consumer of semiconductor materials, finds SEMI.
Author: Srinivasa Reddy N