Semiconductor silicon chips are in short supply, and major international manufacturers have raised prices one after another. Due to the expansion of global 3D NAND flash production and a large number of wafer production capacity invested and put into operation in mainland China, the global semiconductor silicon wafer supply is tight. The three semiconductor silicon wafer factories announced that they would increase the price of 12 inch silicon wafer in Q1 2017 by 10 ~ 20%. The changes of silicon supply and price will have a great impact on the whole IC chip industry. We believe that the situation of short supply will continue in the next few years. The expansion rate of silicon production capacity will be lower than the demand growth of wafer manufacturing. The price of silicon will also change the downward trend in the past few years and the industry will enter a new cycle.

Development status of global semiconductor silicon wafer industry: shipments continue to recover and giants monopolize.

In 2015, the global semiconductor silicon wafer market was about US $8 billion, accounting for a large proportion of IC manufacturing materials, and the shipment volume has continued to recover since 2013. The sales of shin Etsu and sumco in Japan accounted for more than 50%, and the sales share of the top six silicon wafer factories reached 92%. China Taiwan global wafer has acquired Topsil and SunEdisonSemi in 2016, and will become the third largest semiconductor wafer supplier in the world.

Capacity status and demand forecast of global Wafer Foundry: continue to grow rapidly.

According to the statistics of icinsights, the global monthly wafer production capacity in December 2014 and 2015 was 6.85 million and 7.27 million pieces (converted by 12 inch silicon wafer), respectively. Storage chip manufacturers and pure wafer foundry are the main contributors to the production capacity. The demand for 12 inch wafers will still grow rapidly, and the number of global 12 inch wafers is expected to continue to increase by 2020. According to the prediction of icinsights, the wafer production capacity of IC manufacturing plants will reach 8.63 million and 9.47 million by 2018 and 2020 respectively (converted by 12 inch silicon chips), and the compound annual growth rate from 2015 to 2020 will be 5.4%.

Four factors lead to the shortage of semiconductor silicon wafers in the next few years.

1) TSMC, Samsung Electronics and Intel, the world's largest foundry companies, have entered the high-end process competition. The proportion of advanced processes below 20nm in the whole wafer foundry will be higher and higher, and the demand for high-quality large silicon wafers by advanced processes is increasing;

2) Samsung, SK Hynix, Intel / micron, Toshiba, etc. are fully committed to the expansion of 3D NAND production. The investment boom of 3D NAND will stimulate the demand for 300mm large silicon wafers;

3) Although the growth rate of smart phones slows down, mobile phone innovation continues, and the demand for high-end 300mm silicon chips will still grow rapidly. At the same time, IC chips such as industrial and automotive semiconductors, CIS and the Internet of things began to grow rapidly, which brought new increment to 8-inch and 12-inch silicon chips;

4) the mainland semiconductor manufacturers are expanding their products in large scale, and they are also indissoluble forces. From 2016 to 2017, 19 new factories were built globally, of which 10 Chinese mainland accounted for 12 inch wafers.

Global semiconductor silicon wafer production capacity: short supply will be the norm.

Although the global silicon wafer market has begun to recover since 2014, the silicon wafer industry has still suffered more losses and less profits in recent years, and major silicon wafer factories are unable to expand production. Therefore, the output growth of global silicon wafers is slow. According to semi's prediction, the compound growth rate in the next three years is about 2-3%, corresponding to the production capacity of 300mm silicon wafers in 2017 and 2018, which are 5.25 million pieces / month and 5.4 million pieces / month. According to sumco's data, the global demand for 300mm silicon wafers has reached 5.2 million pieces / month in the second half of 2016, and the global demand for 300mm silicon wafers in 2017 and 2018 is 5.5 million pieces / month and 5.7 million pieces / month respectively. It is expected that the shortage of silicon wafers will be normal in the next few years.