China remained the world's largest and fastest-growing market for semiconductor manufacturing equipment in the second quarter, according to global chip industry association SEMI, as the country pushes to be technologically self-sufficient amid sanctions by the US.
In the June quarter, China saw sales of chip-making equipment - including tools for wafer processing, assembly, packaging and testing - jump 62 per cent year on year to more than US$12 billion.
The soaring demand in China helped lift worldwide income from semiconductor gear by 4 per cent to US$26.8 billion, despite sales contraction in major markets, including South Korea, Taiwan and North America. Japan, ranked fifth by market size, recorded a revenue rise of 6 per cent to US$1.6 billion.
"The semiconductor equipment market has returned to growth, driven by strategic investments to support continued strong demand for advanced technologies and regions seeking to bolster their chip-making ecosystems," said SEMI CEO and president Ajit Manocha.
The momentum is set to carry on the rest of this year and next, with SEMI projecting a 3.4 per cent rise in global sales for the full year 2024 to a historical high of US$109 billion, followed by a robust expansion of around 17 per cent in 2025.
SEMI expected China to maintain the top position through 2025, although the country may register a sales drop "following significant investments over the past three years", according to a report published by the group in July.
China's escalating demand for chip-making equipment, driven by Beijing's drive to cut reliance on foreign supplies, comes amid growing tensions between the world's two largest economies, which could further hinder Chinese technological advancement.
Washington started to block shipments from Dutch chip-lithography giant ASML to China as early as 2018, and in January this year, the Netherlands revoked an export licence that had allowed ASML to ship to China its NXT: 2000i machine and other higher-end tools, which support production at the advanced 7-nanometre and 5-nm processes.
Under US pressure, the Dutch government has been mulling further restrictions on ASML's ability to repair and maintain its advanced wafer fab equipment already installed in China, according to a Bloomberg news report last month.
Mainland China continues to be ASML's biggest market. The country accounted for nearly half of the company's net system sales of €4.8 billion (US$5.3 billion) in the second quarter.
China buys US$12 billion worth of chip-making tools in a quarter
The soaring demand in China helped lift worldwide income from semiconductor gear by 4 per cent, despite contraction in major markets.
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