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China Surpassed South Korea for the First Time and Became the World's Largest Semiconductor Equipment Market

12/29/2018

The latest data shows that China has surpassed South Korea for the first time to become the world's largest semiconductor equipment market. According to recent news from the International Semiconductor Equipment and Materials Association (SEMI), the shipment of Korean semiconductor equipment in the third quarter of this year was 3.45 billion US dollars, a decrease of 29% from the previous month and a 31% decrease from the same period last year. This is the first time that South Korea’s equipment shipments have declined since the first quarter of 2016 ($1.68 billion).

South Korea's semiconductor equipment shipments surged after the third quarter of 2016. Due to the good market prospects of DRAM and flash memory chips, Samsung Electronics and SK Hynix have been actively expanding production lines. In the first quarter of 2017, South Korea's semiconductor equipment shipments reached US$3.53 billion, surpassing Taiwan ($3.48 billion) for the first time and becoming the world's largest semiconductor equipment market. In the first quarter of 2018, the Korean semiconductor equipment market reached a record high of US$6.26 billion. Since then, it has declined. In the second quarter, it was only US$4.86 billion. In the third quarter, South Korea won the first place in the six quarters, the semiconductor equipment market. The scale is only 3.45 billion US dollars, ranking second. According to analysts in the semiconductor industry, the chip market is in good shape in the first half of this year, but the demand in the second half of the year has decreased, the market sentiment has declined, and Samsung Electronics and SK Hynix have adjusted their investment plans. The overall equipment market has decreased.

The scale of China's semiconductor equipment market continues to expand. In the third quarter, China's semiconductor equipment market was US$3.98 billion, up 5% quarter-on-quarter and 106% year-on-year, making it the world's largest semiconductor equipment market. In the third quarter of 2017, China's semiconductor equipment market was only 1.93 billion US dollars. At that time, it was only 2/5 of the size of the Korean market. In just one year, China achieved a go-ahead and the market scale doubled.

According to the SEMI report, China is currently building 25 FAB construction projects in 16 regions including Beijing, Tianjin, Xi'an and Shanghai. The report predicts that China's semiconductor equipment market is expected to reach US$11.8 billion this year, a 43.9% year-on-year increase. The market size is expected to expand to US$17.3 billion next year, an increase of 46.6%, making it the world's largest market.