Knometa: South Korea will account for 22.2% of semiconductor production capacity in 2023, ranking first

Recently, Knometa Research, a semiconductor capacity research company, announced the semiconductor capacity of various countries/regions by the end of 2023 (the output of semiconductor wafer products produced in the country/region where the factory is located, regardless of the headquarters location) and future forecasts.

The report shows that by the end of 2023, South Korea's capacity will account for 22.2%, Taiwan's will account for 22.0%, China's mainland will account for 19.1%, Japan's will account for 13.4%, the United States' will account for 11.2%, and Europe's will account for 4.8%. In terms of future prospects, China's share is gradually increasing, and it is expected to obtain the largest country/region share by 2026. On the other hand, Japan's share is expected to decline from 13.4% in 2023 to 12.9% in 2026.

Calculated based on 200mm wafer equivalent capacity at the end of each year (Source: Knometa Research)

Since the COVID-19 pandemic, there has been a surge in new fab construction around the world. This is likely to continue as many countries are offering subsidies to attract domestic semiconductor manufacturing and help address supply chain issues exposed during the pandemic. Growth is expected to be relatively modest in 2024, but new capacity will grow significantly in 2025 and 2026.

New factories are being built in all semiconductor production regions around the world. This is also true in China. US semiconductor regulations targeting China are trying to curb Chinese companies from developing and introducing advanced processes, but it is expected that China's wafer production capacity will continue to grow in the next few years, mainly in traditional processes. By 2026, mainland China's wafer production capacity will become the world's largest, surpassing South Korea and Taiwan.

Most foreign companies that have built factories in China, including Samsung Electronics, SK hynix, TSMC, and UMC, have received partial exemptions from semiconductor regulations for China. A large part of China's integrated circuit wafer production capacity comes from these large foreign companies, as well as Powerchip Semiconductor Manufacturing Company, Texas Instruments Alpha & Omega Semiconductor, and Diodes. By the end of 2023, China's wafer production will account for about 19% of global wafer production, and only 11% of it is produced by Chinese companies.

Currently, the production capacity of these Chinese companies is also constantly increasing. Knometa predicts that by 2025, China's production capacity share will be almost on par with major countries, and by 2026, China will become the leading country.

Semiconductor equipment spending accounts for one-third of the world

In addition, in terms of semiconductor equipment spending, mainland China will account for one-third of the global total in 2023.

According to data from the semiconductor industry organization SEMI, global sales of semiconductor manufacturing equipment reached US$106.3 billion in 2023, a slight decrease of 1.3% from the historical peak of US$107.6 billion in 2022.

By region, mainland China remains the world's largest semiconductor equipment market, investing US$36.6 billion in the field last year, an increase of 29%, accounting for 34.43% of the global market.

It is understood that mainland China has adopted a large number of mature process semiconductors above 28 nanometers in many fields such as automobiles, and currently accounts for 29% of the global production capacity.

Affected by the export controls on advanced equipment by the United States and other countries, mainland China has begun to expand its investment in mature processes. It is estimated that by 2027, the production capacity of mature processes will account for 39%.

According to agency statistics, the production capacity of semiconductor manufacturers in mainland China increased by 12% year-on-year in 2023, reaching 7.6 million wafers per month. It is expected that by 2024, mainland China will launch 18 projects, and the production capacity will increase by 13% year-on-year to 8.6 million wafers per month.

From Electronic Engineering World