While Japanese single silicon crystal may enjoy absolute reliability when it comes to product quality, it seems the country no longer has the complete grip it may once have had on the global market for silicon wafers.
In the global market for silicon wafer production, in first quarter 2012 Japan accounted for 44.6% of production. Second quarter 2012 saw the country account for 45.3% of global production; Japan therefore fell below 50% of global production for two successive quarters.
Even taking into account a decrease in first quarter 2011 due to the effects of the great earthquake, the statistics in 2012 still reflect a major decrease, The Gas Review (TGR) reports.
Production in Japan showed an increase of 2.1% for the second quarter, compared to the same quarter in 2011, but for the month of June there was a drop of 12.8% over the same month of the previous year.
TGR describes a two-fold dynamic that has contributed to this decline, notably the effects of the aforementioned earthquake, and the sharp appreciation of the yen.
Until three years ago the two major silicon wafer producers in Japan, Shin-Etsu Handotai and SUMCO, accounted for nearly 60% of the global market. When it came to 300mm wafers in particular, they accounted for 90%, demonstrating their dominance in the marketplace.
However, as a result of the tragic earthquake last year, the Shin-Etsu Handotai plant in Shirakawa and the SUMCO plant in Yonezawa were damaged and production was affected. Even after the recovery efforts, production did not return to full capacity.
Further still, the situation with the appreciation of the yen compared to the dollar, for example, is ‘whittling away the ability to compete’.
As far as back as 10 years ago, there began a shift in production to Korean firms like Samsung Electronics and SK Hynix. With the results from the first two quarters of 2012 and the increasing appreciation of the yen, however, TGR notes that the decline in Japanese silicon wafer production has become more apparent.
The Gas Review, Issue No: 360