News of the capacity of fresh waffles is usually declining in both directions. It brings a wave of excitement with the promise of expanding the semiconductor ecosystem and creating new jobs in technology. At the same time, however, this makes people nervous amid fears of overcapacity.

According to IC Insights’ Update for February 1 to The McClean report for 2022, there will be an 8.7% jump in the forecast for the capacity of the chip industry this year and it comes mainly from the addition of 10 new 300-mm waffle factories, which should open this year. This includes two new memory factories at SK Hynix and Winbond, as well as three new plants at the world’s largest foundry for pure gaming TSMC, two in Taiwan and one in Nanjing, China.

Figure 1 The Fab M16 in Icheon, South Korea, will begin production of DRAM in a 10-nm process. Source: SK Hynix

In 2021, the number of 300-millimeter waffle factories increased by 14, the highest number in a year since 2005, when the same number of factories opened in one year. Now add 10 new foundries to open this year, followed by another 13 in 2023 and 10 in 2024, and you can see the big picture. By 2026, there will be more than 200,300 mm production lines in operation, according to estimates made in Knometa’s new report on Global Wafer Capacity 2022.

This unprecedented factory build resonates with chronic chip shortages and ongoing supply chain problems. However, the semiconductor industry is also known for its cyclical nature and changing requirements depending on market conditions. Another factor for these concerns is that factories in China are preparing to enter the semiconductor memory market.

Figure 2 Winbond’s new plant is scheduled to begin producing niche DRAMs in September, initially producing 3,500 pads a month and gradually expanding to 10,000 waffles by December. Source: Winbond

For now, the demand for chips remains stable. In fact, IC Insights predicts that semiconductor shipments will increase by 9.2% this year as 10 new waffle factories enter service. IC Insights also predicts that demand for semiconductors is expected to help keep global capacity utilization up from 93.0% in 2022, a slight decline from 93.8%. in 2021

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https://www.edn.com/is-2022-the-year-of-the-semiconductor-fab-industry-makeover/

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