Taiwan biggest IC material buyer in world for 7th straight year

Taipei--Taiwan was the largest buyer of integrated circuit production materials in the world for the seventh consecutive year in 2016, the U.S.-based Semiconductor Equipment and Materials Institute (SEMI) said Tuesday.

Taiwan's purchases of integrated circuit materials for IC production totaled US$9.79 billion in 2016, again vaulting the country into the top spot in the world, SEMI data showed.

SEMI said the top ranking and the 3.9 percent year-on-year growth in purchases last year resulted from the strong competitiveness of the country's wafer foundry operations and IC packaging and testing services.

Pure foundry operator Taiwan Semiconductor Manufacturing Co. (???) is the largest contract chip maker in the world, while Advanced Semiconductor Engineering Inc. (???) is the largest IC packaging and testing services provider worldwide.

South Korea came in second with US$7.11 billion in purchases of IC materials in 2016, ahead of Japan, whose purchases totaled US$6.74 billion, SEMI said.

China bought US$6.53 billion in IC materials to become the world's No. 4 buyer in 2016, up 7.3 percent from a year earlier, the largest year-on-year growth among all nations and regions in the world, SEMI data showed.

The IC production material market generated US$44.3 billion in sales in 2016, up 2.4 percent from a year earlier, with wafer foundry production material sales at US$24.7 billion and IC packaging and testing material sales at US$19.6 billion, SEMI said.

Meanwhile, statistics compiled by the Ministry of Finance showed that semiconductor products accounted for 30.7 percent of Taiwan's total exports of US$280.40 billion in 2016, the highest ratio in the country's history and nearly double the 15.2 percent ratio seen in 2005.

The ministry said the semiconductor sector was also instrumental in helping Taiwan end a slump in July 2016 of 17 consecutive months in which exports fell year-on-year.

IC manufacturers in Taiwan have since aggressively increased capacity by buying production materials, including production equipment, to meet recovering demand, the MOF said.

The ministry warned, however, that the IC sector's high share of Taiwan's exports reflected the economy's heavy dependence on the sector and a potential imbalance in Taiwan's industrial development, and that more industrial diversification was needed.

In terms of global IC export shares, Taiwan had a 14.7 percent share of global IC exports in 2015, the fourth highest, trailing China (19.9 percent), Hong Kong (18.4 percent) and Singapore (16.0 percent), ministry figures showed.

South Korea took fifth place with a 10.8 percent share.

The MOF said China, whose share of global IC exports rose from only 5.9 percent in 2005 to more than three times that in 2015, has emerged as a strong competitor to Taiwan.

Including Hong Kong, China accounts for nearly 40 percent of global IC exports, showing its formidable strength, and with Beijing moving aggressively to cultivate its own IC supply chain, its threat to Taiwan is expected to loom even larger in the future, the MOF said.

Thai

Source: Focus Taiwan News Channel