Semiconductor market news(Mar. 06 to Mar. 12)丨 AI Services Could Influence Demand for GPUs; Murata announces expansion of silicon capacitor production line; Customer Excess Hits the Open Market for Memory Modules…

01. AI Services Could Influence Demand for GPUs

With the spotlight on AI services like ChatGPT and BARD, high-performance GPU vendors are starting to wonder what the implications will be on the market. Forecasts project that the GPU market could grow by at least 15% this year if demand stays strong. Nvidia will benefit the most from this development, as their Amphere A100 and Hopper H100 architecture is amongst the best-performance GPUs available. As a result, the company has already seen its stock increase by 40%.

AI GPU business is forecasted to spike, and manufacturers may prioritize production and supply for AI customers over gaming customers. This situation may cause additional supply issues for a constrained consumer GPU market.

02. Murata announces expansion of silicon capacitor production line

Mar. 9, 2023, Murata has announced that it is building a new 200mm mass production line in Caen, France, to expand its silicon capacitor production capacity.

Murata said it will start preparing for the expansion in April this year and will create more than 100 new jobs between 2023 and 2025. The Silicon Capacitors manufactured by Murata in this factory are used in demanding applications such as implantable medical systems, telecommunication infrastructures, and mobile phones.

The new line will be based on 200 mm wafers, focusing on the PICS (Passive Integration Connective Substrate) latest technology, which has dramatically higher performance on electrical characteristic. These products will primarily target the mobile handset market with very high performances and capacitance values in super small sizes with thickness as low as 40 μm.

03. Infineon announces long-term agreement with UMC for the production of 40nm eNVM microcontrollers

Mar. 8, 2023, Infineon Technologies AG and United Microelectronics Corporation (“UMC”) yesterday announced a long-term strategic cooperation agreement to multiply capacity for the production of Infineon automotive microcontroller in order to serve the rapidly expanding automotive market. The high-performance microcontroller product leverages Infineon’s proprietary eNVM (embedded non-volatile memories) technology and will be manufactured at UMC’s Singapore fab on its 40nm process.

Microcontroller are key components controlling a wide range of functions in vehicles, and demand is increasing as cars evolve to become ever greener, safer, and smarter. Already this year, Infineon is ramping the selling rate of automotive microcontroller to close to one million per day.

04. China's silicon wafer suppliers are on the rise

Mar. 7, 2023, According to TheElec, in the past three years, South Korea's imports of silicon wafers from China have continued to grow. Imports from China totaled $424 million in 2020, $563 million in 2021, and $777.7 million in 2022.

On the contrary, South Korea's imports of silicon wafers from Japan have declined in the past three years. Imports totaled $916 million in 2020, $948 million in 2021, and $897 million in 2022.

The report pointed out that the silicon wafer market is worth about 12 billion US dollars, of which the top five suppliers account for more than 95% of the market share. According to the data for 2021, Shin-Etsu has a 31.4% market share, followed by Sumco with 24.4%, GlobalWafers with 17.8%, SK Siltron with 13.5%, and Siltronic with 9.5%.

However, the market has changed over the past two years. Suppliers in China are rising due to cost competitiveness, but the wafers provided by these suppliers are mostly low-end 6-inch and 8-inch wafers at low prices.

Industry insiders said that this will not affect the global silicon wafer supply chain in a short period of time, but in the long run, no one will know.

05. Customer Excess Hits the Open Market for Memory Modules

Customers with excess supply, particularly 32GB and 64GB RDIMM, have begun to funnel their surplus to the open market. The increased open market availability is affecting pricing, which was already exceedingly low. Manufacturers are doing their best to avoid further price erosion for memory modules and have issued an order for distributors to limit the approval of any special pricing for customers.

Over the past several months, a global shortage has affected the supply and demand for 128GB RDIMM 3200. This shortage is primarily the consequence of poor forecasting. Historically the demand for this density has been minimal, but the sudden spike in customer interest has caused prices to increase steadily over the last few quarters. Pricing is currently as much as 20% higher than official pricing and could rise further if supply doesn't improve.

06. Unstable Supply for Industrial Fan and Raspberry Pi Triggers Extensive Lead Times

Industrial fan supply is worsening, with more and more customers turning to the open market to meet their sourcing needs. The main driver of this shortage is constrained supply in the printed circuit board assembly (PCBA) stage. These raw materials are also vital to the electric vehicle industry, but multiple industries compete for supply, making allocation difficult. The current backlog and material shortage have caused lead times to stretch between 58 – 78 weeks.

Since January, Raspberry Pi has struggled with shortages, and supply is currently volatile. There is an extensive buildup of unfulfilled orders, and vendors cannot provide firm commitment ETA dates. Customers are finding more support in the open market, but available parts are subject to premium rates as open market costs are usually three to five times higher than direct pricing.

Raspberry Pi’s popularity partially stems from its low costs, but the shortage has expanded open market pricing over the past couple of months to 50% – 200% higher than the authorized retailer price. Despite the lack of clarity on order delivery, customers have hesitated to go to the open market because of the inflated costs.

07. SiC power component market is expected to exceed $2.2 billion in 2023

Mar. 10, 2023, According to TrendForce's latest report, the expanded cooperation between semiconductor suppliers and automotive and energy companies will drive the overall SiC power device market value to $2.28 billion in 2023, an annual growth rate of 41.4%.

According to TrendForce, the top two applications of SiC power components are electric vehicles and renewable energy, which will respectively reach $1.09 billion and $210 million in 2022, accounting for about 67.4% and 13.1% of the overall SiC power component market output value.

In terms of electric vehicles, onsemi's EliteSiC 1200V main inverter power module has been confirmed to supply Volkswagen and Kia Motors; while Wolfspeed provides Mercedes-Benz with SiC power components required for its electric vehicles.

In terms of renewable energy, onsemi provides Ampt with SiC MOSFETs required for solar energy and energy storage system optimizers; while Infineon's CoolSiC has been adopted by Delta's bidirectional inverters for solar power generation and energy storage , electric vehicle charging three-in-one system, and also help Bloom Energy's fuel cell and electrolysis system to improve efficiency.

TrendForce predicts that by 2026, the market value of SiC power components is expected to reach $5.33 billion. Among them, the electric vehicle market reached $3.98 billion, with a CAGR of about 38%; the renewable energy market reached $410 million, with a CAGR of about 19%.

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