Abstract:With the development of China's economy and the improvement of technological level, the demand for electronic products is also increasing, which in turn promotes the growth of the semiconductor silicon wafer market. The Chinese government has always regarded the semiconductor industry as one of the strategic industries supported by the state. The government has introduced a series of incentives, including financial support, tax incentives, and R&D funding, to promote the development of the semiconductor wafer industry. As a result, domestic wafer manufacturers have been supported in terms of independent technological innovation and capacity expansion, which has driven the growth of the market size. In 2023, the size of China's semiconductor wafer market will be about 16.485 billion yuan.
1. Definitions and Classification
Semiconductor wafer refers to Silicon Wafer, semiconductor-grade silicon wafer, which is used for the manufacture of semiconductor products such as integrated circuits, discrete devices, and sensors. Common semiconductor materials include elemental semiconductors such as silicon (Si) and germanium (Ge) and compound semiconductors such as gallium arsenide (GaAs) and gallium nitride (GaN). Compared with germanium, silicon has a melting point of 1415°C, which is higher than the melting point of germanium of 937°C, and the higher melting point allows silicon to be widely used in high-temperature processing processes; The bandgap width of silicon is greater than that of germanium, which is more suitable for making high-voltage devices. Compared with gallium arsenide, silicon is safe, non-toxic and environmentally harmless, while arsenic is a toxic substance; In addition, germanium and gallium arsenide have no natural oxides, and multi-layer insulators need to be deposited on the surface during wafer fabrication, which will lead to an increase in the production steps of downstream wafer manufacturing, thus increasing production costs.
Semiconductor silicon wafers are the basis for the manufacture of silicon semiconductor products and can be classified according to different parameters. According to the size (diameter), semiconductor silicon wafers can be divided into 2 inches (50mm), 3 inches (75mm), 4 inches (100mm), 5 inches (125mm), 6 inches (150mm), 8 inches (200mm), 12 inches (300mm), under the influence of Moore's law, semiconductor silicon wafers are constantly developing in the direction of large size, at present, 8 inches and 12 inches are mainstream products, and the total shipping area accounts for more than 90%.
Second, the business model
1. Manufacturing
Manufacturing is the core of China's semiconductor wafer industry. Enterprises need to invest a lot of money to purchase advanced production equipment, build clean workshops and laboratories, and train a team of high-quality production workers and technical personnel. The efficiency and quality of manufacturing directly affect the competitiveness and market position of enterprises. In terms of business model, some companies adopt a vertically integrated model to achieve the growth of silicon wafers to the manufacturing of finished chips to improve production efficiency and reduce costs. Others, on the other hand, focus on a specific segment, such as crystal growth or wafer processing, and form an industrial chain by partnering with other companies.
2. Technological innovation
Technological innovation is an important driving force for the sustainable development of China's semiconductor wafer industry. Enterprises need to continuously improve the level of process technology, reduce production costs, and improve product quality and performance to meet market demand. At the same time, it is also necessary to continuously conduct research and development and launch new products and technologies with independent intellectual property rights. In terms of business model, some enterprises regard technological innovation as their core competitiveness, increase R&D investment, and establish their own R&D team and innovation system. These companies usually cooperate with scientific research institutes, universities, etc., to jointly promote technological progress.
3. Marketing sales and service support
Marketing sales is an important means for enterprises to obtain orders and open up the market. Enterprises need to establish stable customer relationships, understand customer needs, and provide products and services that meet market demand. At the same time, it is also necessary to flexibly use marketing tools to expand market share. In terms of business model, some companies adopt a direct sales model, directly facing customers through self-built sales teams and providing personalized services. Others opt for an indirect sales model, expanding their sales channels through agents or distributors.
3. Industry policy
Under the wave of information technology revolution, the semiconductor industry, as the core of the information technology industry, is the foundation of the national economy and national security, and it is also a key area supported by national policies. In February 2024, the Henan Provincial People's Government issued the "Notice on Clarifying the Key Work Responsibilities in 2024 Proposed in the Government Work Report", which pointed out: focusing on high-end screens, intelligent terminals, special cores, sensors and new computing power, promoting the construction of China (Zhengzhou) Intelligent Sensor Valley to accelerate the construction of the file, and accelerate the implementation of the new display base in the airport area, the Unisplendour Smart Terminal Industrial Park, the second phase of the large-size silicon wafer of the crystalline, The global headquarters and R&D center of super fusion, Henan Electronic Semiconductor Industrial Park and other projects have attracted upstream and downstream enterprises in chips, storage, and basic software to gather into clusters.
Fourth, industry barriers
1. Technical barriers
Semiconductor wafer manufacturing is a highly technology-intensive field that requires mastery of advanced manufacturing technologies and processes. This involves a series of process steps such as crystal growth, wafer processing, lithography, thin film deposition, etc., which requires a lot of expertise and experience. There is still a certain gap between Chinese enterprises and international leading enterprises in terms of technology, and they need to continuously increase R&D investment and improve their independent innovation capabilities.
2. Financial barriers
The construction of a semiconductor wafer production line requires huge investment, including equipment procurement, plant construction, personnel training, etc. International leading enterprises have great advantages in financial strength, and can more easily expand production scale and improve technical level. Chinese companies need to face financing problems, and at the same time increase the connection with the capital market to attract more capital to invest in the semiconductor industry.
3. Supply chain barriers
The manufacturing of semiconductor silicon wafers requires a large number of raw materials and equipment, involving many supply chain links such as crystalline silicon, photoresist, etching solution, etching solution, etching solution, etching solution, etching, etc Some international raw material and equipment suppliers have a high degree of monopoly, and Chinese enterprises are facing supply chain risks. Building a sound domestic supply chain system and improving self-sufficiency is an important development direction.
4. Legal and regulatory barriers
The semiconductor industry is greatly affected by international trade policies and laws and regulations, such as export controls, intellectual property protection and other restrictions. Chinese companies need to abide by international rules, and at the same time actively participate in the formulation of international standards and trade negotiations, so as to enhance their competitiveness in the international market.
5. Talent barriers
The semiconductor industry has a large demand for high-end talents, but the supply is relatively limited. Chinese enterprises need to increase talent training and introduction, build a high-quality R&D and management team, and enhance their innovation ability and competitiveness.
Fifth, the industrial chain
The upstream of the semiconductor wafer industry chain is the supplier of raw materials, mainly polysilicon, straight-pull furnace equipment, polishing slurry and others; The midstream of the industrial chain is monocrystalline silicon wafers and epitaxial wafers; The downstream of the industrial chain is the application field, mainly in the fields of computer, automobile, medical, aerospace and other fields. From the perspective of downstream applications, 8-inch semiconductor silicon wafers are mainly used in sensors, logic chips, discrete components, optocouplers, etc., and the terminal application fields are mainly automotive, industrial (including smart factories, smart cities, automation) and smart phones. The demand for 12-inch silicon wafers mainly comes from memory chips, logic chips and other applications, and the terminal application fields are mainly smartphones, PCs/tablets, servers, TVs/game consoles, and server, industrial, automotive, and communication applications account for a relatively small proportion.
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