This article from August reports that Siltron’s net income for 1H17 was $24 million, nearly five times the company’s net income for the entire year of 2016, with roughly $395 million in sales. They expect to make at least ₩1 trillion in sales for the full year, which EK News converts to $893 million (Google converts it to $904 million). Even 1 trillion is a small fraction of SK Group’s total ₩125.92 trillion in sales for 2016. Basically, business is booming.
The Japanese company SUMCO is one of the largest silicon wafer manufacturers in the world, along with Shin-Etsu Chemical. CEO Hashimoto Mayuki said, “we are also planning to increase price of silicon wafer by 20% in 2018” and “Price of silicon wafer will continue to rise in 2019.” SUMCO’s prediction for Q4 2017 is that 300mm silicon wafer price will be at least 20% higher than it was in Q4 2016. They currently see demand for 5.6 million units per month, but predict an increase to 6.6 million per month in 2020.
To account for increasing demand, SUMCO will increase monthly output by 110,000 units in 2019, German manufacturer Siltronic’s output will increase by 70,000 units per month, and Shin-Etsu will also increase production; however, this won’t necessarily meet demand.
ET News quotes an industry official: "PC DRAM, the flagship memory product, has risen nearly 170 percent in October compared to last June when prices began to rise, so it does not meet the demand for price increases in the wafer industry [Google translate].” “Price of silicon wafer will continue to go up as wafer industries will continue to show lukewarm stance towards extensions [website translation].”
Limited supply is a sure way of keeping prices high, as we’ve often reported in reference to DRAM production. Even ignoring that, it makes sense that manufacturers are wary of scaling up production in an industry that has so recently been in financial trouble. For the time being, DRAM and products dependent on 300mm wafers will continue to rise in price.
Editorial: Patrick Lathan