[special topic on SMM] the chip and semiconductor market continues to be hot, and the price of silicon rises by more than 200% for enterprises to expand production capacity.

The market of chip semiconductors continues to be hot.

The stock market has continued to rise since May. According to statistics, the third-generation semiconductor sector has risen nearly 40% since early May, the automotive chip sector has risen by more than 30%, and the domestic chip sector has risen nearly 30%. The performance of individual stocks is even more eye-catching. Shilan Weiwei's share price is up more than 80% from the beginning of May, China Resources Micro is up nearly 70% from the beginning of May, Fuman Electronics is up 133% in just one month, Sai Microelectronics is also up 117%, and other stocks are also up one after another.

The shortage of chips hits the global auto market.

Behind the sharp rise in stock prices is the trouble caused by the shortage of chips. it is reported that many car companies around the world have reduced their car production or even stopped producing some models due to the shortage of chips. the affected car companies include Ford, BMW, Mercedes-Benz, Audi, Honda, Volkswagen and a series of well-known brands. Earlier this year, a cold snap in Texas caused widespread power outages across the state, disrupting chip delivery for about four weeks. The sudden fire of Renesa Electronics, a Japanese chip supplier, made the situation even worse. Recently, the suspension of work in Taiwan and the closure of Malaysia have further worsened the situation.

The chip price skyrocketed and the giant in the industry set a record in revenue.

Chip shortage is difficult to solve, a "core" difficult to find the situation has not been reversed, relevant companies have announced price increases, chip prices skyrocketing, industry giant revenue record. Take a NXP as an example, the price was about 15 yuan a year ago, but it soared to more than 100 yuan or even close to 200 yuan a year later. In the first quarter of 2021, the total output value of the top 10 foundry manufacturers broke through the single-quarter record high, reaching 22.75 billion US dollars (about 1451 yuan), an increase of 1451 compared with the previous quarter. Under the chip shortage, the wafer production capacity is seriously insufficient, and the production capacity of TSMC, the leading foundry foundry, has appeared in a "second light" situation, and the current TSMC order has been arranged until the end of 2022. According to public reports, TSMC will cancel discounts to customers and raise prices in disguise starting from the end of 2021. Huang Chongren, chairman of LSMC, also said that since 2020, wafer foundry prices have increased by 30% to 40%, and supply and demand continue to be tight, and the price increase will continue. LSMC's capacity in 2022 has been fully booked by customers and is now booked for 2023.

The price of silicon at the end of raw materials is all the way up.

Affected by the shortage of chip semiconductors, the price of silicon at the end of the raw material has also gone up all the way. Over the past year, the price of polysilicon has continued to rise. The spot price of SMM polysilicon is 217 yuan per kilogram on June 23, which is 216% higher than that of the same period last year. Polysilicon prices continue to rise due to the imbalance between supply and demand of polysilicon production and the situation that supply falls short of demand. SMM believes that as it takes time for polysilicon to reach production, even if Q4 first-line silicon enterprises put into production as scheduled, it will not be able to form an effective supply, which means that it is difficult for polysilicon prices to return to normal operating range this year.

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The lead time of the chip continues to extend and the downstream is miserable.

In addition to the sharp increase in prices, the chip delivery time is also increasing, with the semiconductor delivery cycle increasing to 16 weeks in March, far exceeding the peak level in 2018, and the chip delivery time reached 18 weeks in May. The longest period since tracking data (2017). The sharp rise in chip prices has led to misery downstream, and some manufacturers said that at present, some orders cannot be taken because of a shortage of chips.

The major enterprises have expanded their production capacity one after another.

Under the current market, the development of domestic chips is extremely urgent. Major enterprises have expanded their production capacity, and Chengdu Shilan Semiconductor, a subsidiary of Shilan Micro, plans to purchase nine 12-inch wafer epitaxial furnaces, testers and other equipment from the affiliated company Xiamen Shilan Jike, with a total transaction value of 46.3117 million yuan. Sanan Optoelectronics Hunan third Generation Semiconductor Industrial Park project has been put into production and semiconductor related projects have been vigorously developed. China Resources Micro announced that its wholly-owned subsidiary intends to set up a joint venture with the National Integrated Circuit Industry Investment Fund Phase II Co., Ltd. and Chongqing Xiyong Microelectronics Industrial Park Development Co., Ltd., with a registered capital of 5 billion yuan. Invest in the construction of a 12-inch power semiconductor wafer production line. Relevant enterprises speed up the pace of development, domestic chips ushered in the peak of development.