For three consecutive quarters, more than 50% of Japan's chip manufacturing equipment exports went to China

Observer.com

2024-06-12 20:00Posted on the official account of Shanghai Observer.com

Japan Economic News reported on June 12 that from the perspective of Japan's semiconductor manufacturing equipment exports in the first quarter of this year, exports to the Chinese market have accounted for more than 50% of the total for the third consecutive quarter. According to the analysis, this shows that under the tense trade situation between China and the United States, China's demand for Japanese semiconductor manufacturing equipment is increasing, China has a special need to replace production lines, and the purchase of general-purpose products has increased.

According to trade statistics from the Ministry of Finance of Japan, exports to China accounted for half of Japan's domestic exports of semiconductor manufacturing equipment and its parts, and flat panel display manufacturing equipment from January to March this year. Since the third quarter of 2023, it has accounted for more than 50% for three consecutive quarters.

In terms of actual value, exports of Japanese equipment to China in the first quarter of this year reached 521.2 billion yen, an increase of 82% compared to the same period in 2023. According to the report, the amount is the highest since 2007, for which comparable data are available.

Since July 2023, the Japanese government has included export controls on manufacturing equipment for cutting-edge semiconductors, such as logic semiconductors with a wire width of 10 to 14 nanometers or less. In order to export products other than friendly countries, approval from the Ministry of Economy, Trade and Industry is required.

Japan's Ministry of Economy, Trade and Industry increased export controls on advanced semiconductor manufacturing equipment in July last year (data map)

Nikkei believes that one of the main reasons for the increase in exports to China is the demand for "catching the last train" brought about by the control. China's imports of semiconductor manufacturing equipment from around the world reached US$5.2 billion in September 2023, 1.5 times that of the same period last year, according to Chinese customs data, with imports from Japan and the Netherlands increasing.

However, Maruyama Yoshimasa of SMBC Nikko Securities said that "the current trend cannot be fully explained by the phrase 'rushing for the last train'".

In fact, Chinese customs data also shows that as of April 2024, the import value of related equipment has been around 4 billion US dollars, which is consistently higher than the same period last year.

Kazuma Kishikawa of Japan's Yamato Research Institute believes that "Chinese manufacturers are turning to the production of general-purpose semiconductors due to the inability to introduce cutting-edge semiconductor manufacturing equipment." This shift has stimulated Japan's unrestricted exports of semiconductor manufacturing equipment.

Japanese media pointed out that the semiconductor market usually goes through a boom and bust cycle of three to four years. Global markets fell into a downturn after the pandemic in the second half of 2022 but are now showing signs of bottoming. In the first quarter of this year, Japan's global chip manufacturing equipment exports increased by 13% year-on-year, turning positive again after four quarters.

According to the preliminary trade statistics released by the Ministry of Finance on May 22, Japan's trade deficit in April reached 462.5 billion yen (about 21.4 billion yuan), an increase of 7.36% year-on-year, and it was also Japan's first deficit in two months.

Kyodo News pointed out that Japan's exports rose 8.3% year-on-year to 8.9807 trillion yen, driven by the growth of exports of automobiles and semiconductor equipment, which was the highest value of exports in April since comparable data became available in 1979.

Among them, the trade deficit with China was 527 billion yen, and the export value increased by 9.6% year-on-year to 1.59 trillion yen, a new high in the same period, and the export value of semiconductor manufacturing equipment increased by 95.4% year-on-year, which was the biggest factor driving exports.

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