SEMI predicts that China will commence the construction of 18 new semiconductor fabs in 2024, ushering in a new peak in global production capacity.
Global semiconductor capacity is expected to increase 6.4% in 2024 to top the 30 million *wafers per month (wpm) mark for the first time after rising 5.5% to 29.6 wpm in 2023, SEMI announced in its latest quarterly World Fab Forecast report.
The report suggests that the expansion of semiconductor production capacity in 2023 will be relatively moderate, primarily due to slowing market demand and inventory adjustments. However, growth in 2024 will be driven by emerging technology domains such as generative artificial intelligence (AI) and high-performance computing (HPC), as well as the recovery of chip demand. Advanced processes and wafer foundry capacity will be further enhanced.
“Resurgent market demand and increased government incentives worldwide are powering an upsurge in fab investments in key chipmaking regions and the projected 6.4% rise in global capacity for 2024,” said Ajit Manocha, SEMI President and CEO. “The heightened global attention on the strategic importance of semiconductor manufacturing to national and economic security is a key catalyst of these trends.”
Covering 2022 to 2024, the World Fab Forecast report shows that the global semiconductor industry plans to begin operation of 82 new volume fabs, including 11 projects in 2023 and 42 projects in 2024 spanning wafer sizes ranging from 300mm to 100mm.This represents the diversified development of the semiconductor industry in various process technologies.
The Rise of China's Semiconductor Industry
Boosted by government funding and other incentives, China is expected to increase its share of global semiconductor production. Chinese chip manufacturers are forecast to start operations of 18 projects in 2024, with 12% YoY capacity growth to 7.6 million wpm in 2023 and 13% YoY capacity growth to 8.6 million wpm in 2024.
Taiwan is projected to remain the second-largest region in semiconductor capacity, increasing capacity 5.6% to 5.4 million wpm in 2023 and posting 4.2% growth to 5.7 million wpm in 2024. The region is poised to begin operations of five fabs in 2024.
Korea ranks third in chip capacity at 4.9 million wpm in 2023 and 5.1 million wpm in 2024, a 5.4% increase as one fab comes online. Japan is expected to place fourth at 4.6 million wpm in 2023 and 4.7 million wpm in 2024, a capacity increase of 2% as it starts operations of four fabs in 2024.
Robust Growth in the Field of Semiconductor Wafer Foundry
The semiconductor foundry operators play a pivotal role in the procurement of semiconductor equipment, leading the expansion of the semiconductor industry.Foundry suppliers are forecast to rank as the top semiconductor equipment buyers, increasing capacity to 9.3 million wpm in 2023 and a record 10.2 million wpm in 2024.
The memory segment slowed expansion of capacity in 2023 due to weak demand in consumer electronics including PCs and smartphones. The dram segment is expected to increase capacity 2% to 3.8 million wpm in 2023 and 5% to 4 million wpm in 2024. Installed capacity for 3D NAND is projected to remain flat at 3.6 million in 2023 and rise 2% to 3.7 million wpm next year.
In the discrete and analog segments, vehicle electrification remains the key driver of capacity expansion. Discrete capacity is forecast to grow 10% to 4.1 million wpm in 2023 and 7% to 4.4 million wpm in 2024, while Analog capacity is projected to grow 11% to 2.1 million wpm in 2023 and 10% to 2.4 million wpm in 2024.
The latest update of the SEMI World Fab Forecast report, published in December, lists 1,500 facilities and lines globally, including 177 volume facilities and lines with various probabilities expected to start operation in 2023 or later.
