Semiconductor Materials Market Report

Market Highlights

Semiconductor materials are essential substances used in the manufacturing of semiconductors, which are fundamental electronic components in electronic devices. These materials include silicon, gallium arsenide, silicon carbide, and various chemicals, metals, and substrates used in semiconductor fabrication processes. Also known as wafer manufacturing or wafer processing, this involves the production of semiconductor wafers, where semiconductor materials are processed and transformed into integrated circuits (ICs) or chips. It is a critical phase in semiconductor production. Semiconductor packaging is the final step in the semiconductor manufacturing process, where individual ICs are enclosed in protective packages or casings. They protect the ICs and provide the necessary electrical connections to other components.

Semiconductor materials' unique properties make them ideal for use in transistors, diodes, integrated circuits, and various electronic devices, such as smartphones, computers, automotive electronics, and many more. The need for improved performance, energy efficiency, and improved functionality of electronic devices has driven the evolution of semiconductor materials.

The COVID-19 pandemic has accelerated the digitalization of numerous businesses, resulting in a substantial increase in the utilization of semiconductor components, greatly benefiting the entire semiconductor manufacturing sector. Despite the presence of geopolitical trade tensions and broader macroeconomic variables introducing uncertainty, the semiconductor materials market exhibited robust performance in 2021, experiencing a notable upsurge of 20% YoY growth. Furthermore, in 2022, the market surpassed the previous year's levels. However, in 2023, the market is expected to experience a decline of 6% YoY, led by weakening demand from the electronics end market and an oversupply of semiconductor chips in recent years. Recovery is expected to commence at the end of 2023, resulting in healthy market growth from 2024 onwards. Increasing demand for miniature/compact gadgets with complex functionalities and the recovery in demand for semiconductors from various end-use industries is expected to drive the semiconductor materials market in the long run. Additionally, the market expansion was driven by advanced process requirements in both wafer fabrication and packaging segments. Overall, the semiconductor materials market is likely to rebound at a promising CAGR of 5.7% in the long run to reach US$ 90.1 Billion by 2028.

Some of the most recent product developments:

• In 2022, L.G. Chem started working on a photoresist (PR), which is used in the semiconductor back-end process, to make it available to global semiconductor companies. The company is developing PR for the back-end process to enhance chip performance after engraving ultra-fine circuit patterns on semiconductors' front-end processes.

Some of the most Recent Market JVs and Acquisitions are:

Over the past few years, there have been a fair number of strategic alliances, including M&As, JVs, etc., across the globe. Some of them have been mentioned below:

• In February 2022, AGC, Inc. increased its investment in Novel Crystal Technology, a company specializing in advanced power semiconductor materials.

In July 2021, BASF, along with Zhejiang Jiahua Energy Chemical Industry Co. Ltd. and its subsidiary Zhejiang Jiafu New Materials Technology, entered into an agreement to enhance the production capacity of electronic-grade sulfuric acid in Jiaxing, China. The objective is to fulfill the increasing needs of China's semiconductor industry players.

Segments Analysis

Based on the materials type, the semiconductor materials market is segmented into wafer fabrication materials and packaging materials. Among them, wafer fabrication materials are expected to remain the largest as well as the fastest-growing segment in the market during the forecast period. Wafer fabrication materials are the foundational elements in the semiconductor manufacturing process. They are used to create the semiconductor wafers through which integrated circuits (ICs) or chips are built. As ICs are the fundamental building blocks of electronic devices, such as computers, the demand for semiconductor wafers remains consistently growing at a healthy pace. Computer systems, automotive electronics, and industrial electronics rely heavily on semiconductor chips, and the growing trend towards smaller and more powerful devices with enhanced features drives the need for advancements in wafer fabrication materials.

Based on application type, the market is segmented into DAO (Discrete, Analog, and Optoelectronics and sensors), logic, and memory. Logic devices are predicted to remain the largest application in the market over the next five years. The increasing prevalence of smartphones, the expanding adoption of electric vehicles, and the growth of 5G telecommunication infrastructure in both developed and developing nations are key factors contributing to the rising demand for semiconductor materials in logic devices.

Based on the end-use type, the semiconductor materials market is segmented into communication, computer, consumer electronics, industrial, automotive, and government. Among them, the computer segment is expected to remain the largest end-user in the market, whereas the communication segment is likely to grow at the fastest pace during the forecast period, due to the advancements in communication technology and related infrastructure, the increasing use of silicon semiconductors in laptops, mobiles, and wireless devices for enabling higher speed and efficiency. Furthermore, the computer industry is at the forefront of adopting emerging technologies, such as artificial intelligence (AI), machine learning, and quantum computing. These technologies often require specialized semiconductor materials to operate effectively, thus fueling the demand for the development of advanced semiconductor materials.

In terms of regions, Asia-Pacific is expected to remain the largest as well as the fastest-growing market for semiconductor materials during the forecast period, mainly driven by Taiwan, South Korea, China, and Japan. Taiwan is the largest semiconductor material-consuming country in the world. Also, this region produces a significant portion of the world's electronic devices, including computers, smartphones, consumer electronics, and industrial equipment, all of which rely heavily on semiconductor materials. The continued expansion of electronics manufacturing in Asia-Pacific fuels the demand for semiconductor materials in the region.

North America and Europe, sizeable markets, are also likely to create healthy growth opportunities in the coming five years, driven by increasing investments in R&D activities. For instance, in 2022, President Biden signed the New Chips Act, a new law that offers more than $52 billion in subsidies and tax breaks to encourage semiconductor manufacturing, research, and development in the USA, which in turn, creates several opportunities for semiconductor materials in North America and sustains the ecosystem of the region.

Segmentation:

The semiconductor materials market is segmented into the following categories:

Semiconductor Materials Market, by Material Type

• Wafer Fabrication Materials (Regional Analysis: North America, Europe, Asia-Pacific, and RoW) 
• Wafer Fabrication Materials (Material Type Analysis: Silicon Wafers, Photoresist, Photoresist Ancillaries, Photomask, Electronic Grade Gases, Wet Chemicals, CMP Slurry and Pad, PVD Targets, and Others)
• Packaging Materials (Regional Analysis: North America, Europe, Asia-Pacific, and RoW)
• Packaging Materials (Material Type Analysis: Lead Frames, Bond Wires, Ceramic Packages, Substrates, Encapsulation Resins, Die Attach Materials, and Others)

Semiconductor Materials Market, by End-use Type

• Communication (Regional Analysis: North America, Europe, Asia-Pacific, and RoW)
• Computer (Regional Analysis: North America, Europe, Asia-Pacific, and RoW)
• Consumer Electronics (Regional Analysis: North America, Europe, Asia-Pacific, and RoW)
• Industrial (Regional Analysis: North America, Europe, Asia-Pacific, and RoW)
• Automotive (Regional Analysis: North America, Europe, Asia-Pacific, and RoW)
• Government (Regional Analysis: North America, Europe, Asia-Pacific, and RoW)

Semiconductor Materials Market, by Region

• North America (Country Analysis: The USA and The Rest of North America)
• Europe (Country Analysis: Germany, The UK, The Netherlands, Austria, and The Rest of Europe)
• Asia-Pacific (Country Analysis: Japan, China, India, South Korea, Taiwan, and The Rest of Asia-Pacific)
• Rest of the World (Country Analysis: Brazil, Saudia Arabia, and Others

Key Players

The market is highly populated, with the presence of several local, regional, and global players. Many players expand their product portfolios to include a wide range of semiconductor materials, catering to diverse customer needs. This diversification involves offering semiconductor materials for different applications and industries. The following are the key players in the semiconductor materials market. Most of the major players are providing both fabrications as well as packaging materials.

• Shin-Etsu Chemical Co., Ltd.
• Merck KGaA
• DuPont de Nemours, Inc.
• Silktronic AG
• Ibiden Co., Ltd.
• Kyocera Corporation
• Toppan Printing Co., Ltd.
• Air Liquide S.A.
• Honeywell International Inc.
• JSR Corporation

Research Methodology

This strategic assessment report, from Stratview Research, provides a comprehensive analysis that reflects today’s semiconductor materials market realities and future market possibilities for the forecast period. The report segments and analyzes the market in the most detailed manner to provide a panoramic view of the market. The vital data/information provided in the report can play a crucial role for market participants as well as investors in the identification of the low-hanging fruits available in the market as well as to formulate growth strategies to expedite their growth process.

This report offers high-quality insights and is the outcome of a detailed research methodology comprising extensive secondary research, rigorous primary interviews with industry stakeholders, and validation and triangulation with Stratview Research’s internal database and statistical tools. More than 1,000 authenticated secondary sources, such as company annual reports, fact books, press releases, journals, investor presentations, white papers, patents, and articles, have been leveraged to gather the data. We conducted more than 15 detailed primary interviews with market players across the value chain in all four regions and industry experts to obtain both qualitative and quantitative insights.

Report Features

This report provides market intelligence in the most comprehensive way. The report structure has been kept such that it offers maximum business value. It provides critical insights into market dynamics and will enable strategic decision-making for existing market players as well as those willing to enter the market. The following are the key features of the report:

• Market structure: Overview, industry life cycle analysis, supply chain analysis
• Market environment analysis: Growth drivers and constraints, Porter’s five forces analysis, SWOT analysis
• Market trend and forecast analysis.
• Market segment trend and forecast.
• Competitive landscape and dynamics: Market share, Product portfolio, New Product Launches, etc.
• COVID-19 impact and its recovery curve.
• Attractive market segments and associated growth opportunities
• Emerging trends
• Strategic growth opportunities for existing and new players
• Key success factors

Customization Options

With this detailed report, Stratview Research offers one of the following free customization options to our respectable clients:

Company Profiling

• Detailed profiling of additional market players (up to three players)
• SWOT analysis of key players (up to three players)

Competitive Benchmarking

• Benchmarking of key players on the following parameters: Product portfolio, geographical reach, regional presence, and strategic alliances

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