01 Policy Trend(Mar. 16)

Against China? India decided to impose an anti-dumping duty

Recently, the Ministry of Finance, Department of Revenue, has issued Notification No. 03/2024-Customs (ADD), saying that it has accepted the proposed final anti-dumping resolution made by the Ministry of Commerce and Industry, India on December 29th, 2023 regarding the imposition of anti-dumping duty on Printed Circuit Boards (PCBs) imported into India from China PR and Hong Kong based on CIF for five years, i.e., 0 - 75.72% for PCBs from Chinese mainland, and 30% for those from Hong Kong. 

This case involves products under the Indian Customs Code 85340,000. The ADD in this case does not apply to the following PCBs: 1. PCBs of more than 6 layers; 2. PCBs used for mobile phones; 3. Filled PCBs of various sizes; 4. Embedded PCBs; 5. Embedded printed circuit boards; 6 POFV or Via-in-Pad PCBs; 7. HDI PCBs; 8. Rigid-flex PCBs; 9. Package Substrate/IC Package Substrate. The ADD shall enter into force on the date of the publication of this notification in the Official Gazette.

Comments:

The Indian government’s recent decision to impose anti-dumping duty on PCBs originating or imported from Chinese mainland and Hong Kong for a period of five years will play a profound impact on the global PCB market.

First, the ADD has directly impacted the trade relations between China and India, especially the export of PCBs. This measure reflects the clear stance of the Indian government to protect its industry against foreign competition.

Second, Indias ADD policy may trigger a restructuring of the global supply chain as it occupies an important position in the global PCB market. Manufacturers may need to re-plan their export destinations or adjust their production landscape to avoid high taxes. Such changes may have a knock-on effect on the balance of supply and demand, prices and profitability in the global market.

In addition, the action by India may lead to a demonstration effect, driving other countries and regions to follow suit and impose similar restrictions on Chinese products. Considering that the USA, EU and other regions have taken anti-dumping actions against Chinese products, this trend may further rise up.

Finally, from a long-term perspective, Indias imposition of ADD on PCBs from China may stimulate Chinese manufacturers to speed up their pace of technological innovation and industrial upgrading. Faced with external challenges, the Chinese PCB industry is expected to increase R&D investment, improve product quality and technical level, to strengthen its international competitiveness and reduce dependence on external market.

Market Trend(Mar. 18)

Foreign media: India’s dream of becoming a chip hub to be "shattered" by China soon!

Last week, when Indias largest conglomerate, Tata Group, commenced its semiconductor plant by   investing US$ 11bn, Indias prime minister said India will become the world leader in the industry. But his dream may soon be shattered!

However, Tata Group does not work for it alone, which may increase the possibility of its success. It will work with Powerchip Semiconductor Corp. in Taiwan to produce older generation mature chips with process node of 28 nanometers or larger. But the problem is that Chinas ambition in cutting-edge chips is being hampered by the export controls of the US and EU, and China is investing funds in traditional chip manufacturing on a staggering scale. This will reduce the profits of each participant and make new small players face a very difficult situation. According to the chairman of Indian Electronics and Semiconductor Association (IESA), Tata Groups success is critical to attracting other chip manufacturers to India. Therefore, it has to overcome huge challenges so that it will be easier for later players to participate in the industry. ITIF said that India may commission two or three plants to produce mature-node chips in the next five years. Currently, Tata Group’s project is ready to absorb billions of dollars of national funds.

Comments:

It is predicated that by 2024, the chip manufacturing capacity of China will exceed the total capacity of the rest countries and regions of the world, with extra 1 million units of mature-node wafers produced per month, sufficiently showing that China has a strong momentum in this area. In contrast, Tata Group, although making an active layout in the industry, only has a production schedule of 50,000 units per month, which is much lower than those made in China. The predication of industry tracker further demonstrates Chinas leading position in the global production of mature-node chips. From 31% in 2023 to 39% in 2027, Chinas global market share is expected to rise steadily, which will undoubtedly reshape the global landscape of chip manufacturing. 

The AI revolution has driven the demand for advanced chips, but unfortunately the capacity utilization rate of mature-node chip manufacturers declined over the past few years, from nearly 100% in 2020 to 65-75% today. This trend indicates that there is a mismatch between the rapid growth of market demand and the capacity utilization of manufacturers. 

However, India faces more daunting challenges in chip manufacturing considering the fact that China has offered incentives valued at more than US$ 150bn. As a capital-intensive, emerging industry, chip manufacturing requires a large amount of capital investment. However, the government of India is already heavily indebted and its infrastructure construction also needs lots of funds. This has imposed great pressure on India to provide adequate financial support. 

In addition, the infrastructure challenge is also a factor that cannot be ignored in the chip manufacturing process in India. Reliable supplies of water and electricity are essential in the chip manufacturing process. Power outage not only disrupts operations, but also damages equipment and wafers during production, resulting in huge losses to manufacturers.

Company Trend(Mar. 16)

Samsung to get US$ 6bn chip grant from the US

According to reliable sources, the US plans to provide more than 6 billion dollars grant to support Samsung Electronics, aiming to help chip maker expand its announced chip project in Texas. The funds will be allocated under the CHIPS Act 2022 and is expected to be one of several key grants announced by the Commerce Department of the USA in the coming weeks. Previously, the Commerce Department of the USA has announced that it plans to grant more than 5 billion dollars to TSMC, Samsungs Asian competitor. Until officially announced, the insiders asked not to be identified.

It is reported that the US government’s grant to Samsung, a leading chip maker in Korea, will be combined with the company’s large-scale additional investment in the US. In 2021, Samsung announced to start a project in Tyler, Texas, with a total investment of US$ 17bn, located near the existing fab of Samsung in Austin. However, it is not clear where the additional investment will be specifically used.

It is worth noting that the announcement to be released only represents a preliminary agreement between the sides. It is still subject to changes and has not yet been finalized. Both Samsung and the Commerce Department of the US declined to make comments, and the White House did not respond to the request for comment.

Comments:

The launch of the CHIPS Act has undoubtedly given new impetus to the global semiconductor industry. With financial allocation of US$ 39bn in grants plus loans and guarantees worth US$ 75bn, the US government aims to attract global top chip companies to manufacture chips locally and restore its leadership position in the domestic and global markets. This not only marks the end of overseas chip production model of the US for decades of years, but also demonstrates its determination and strength in the chip industry strategy.

Intel, as the local US chip giant, is one of the beneficiaries of the feast for the semiconductor industry. Compared with its overseas competitors Samsung and TSMC, Intel has unique geographical advantages and has maintained a close relationship with the US government. It is learned that Intel is negotiating with the US government on a package of CHIP ACT plans worth more than US$ 10bn, including incentives such as grants, loans, and so on. This will undoubtedly greatly boost Intel’s local chip production and is expected to further enhance its competitiveness in the global market.

However, it is worth noting that, although CHIP Act provides attractive incentives for semiconductor manufacturers, not all companies can get loans or financing guarantees smoothly. It is uncertain whether other companies except Intel are eligible for enjoying these policy dividends, which undoubtedly creates uncertainty for those companies interested in developing chips in the US.

In addition, Samsung, one of the global semiconductor leaders, is not interested in loan supported projects, which has also attracted the attention of the market. This attitude may reflect Samsungs confidence in its financial position or some concern about the US market environment. In any case, Samsung’s attitude will have certain impact on the global semiconductor industry.

Company Trend(Mar. 21)

An AI chip start-up to surmount all digital chips

Extropic, startup, has just emerged from stealth mode, indicating that it will develop and manufacture prototype superconducting processor for AI. Recently, Extropic completed a seed funding of US$ 14.1mn and announced it can achieve the goal of creating AI accelerators, " which are many orders of magnitude faster and more energy efficient than digital processors (CPUs/GPUs/TPUs/FPGAs).” The company, led by former members of Alphabet X quantum computing research team, also released its Litepaper, showing the attractive prospect of the full-stack thermodynamic computing platform it is building.

According to Extropic, the current digital processors are not suitable for AI acceleration. The paper introduces a novel probabilistic paradigm of computing that is said to be distanced from increasingly complex pristine digital computers in favor of something more biological and noisy. Extropic’s prototype passive thermdynamic chips for AI runs probabilistic algorithms adopted physics as a rapid and energy-efficient physics-based processes. This makes them more suitable for current AI algorithms than traditional computing processors, because traditional computing processors are quite unnaturally trying to accept probabilities and uncertainties, resulting in inefficiencies.

Comments:

The emerging of Extropic and its ambition to develop prototype superconducting processors for AI have undoubtedly injected new vitality into the technology community. Its seeding funding of US$ 14.1mn not only demonstrates that its cutting-edge technology has been recognized by the market, but also provides the necessary funding for its subsequent R&D and manufacturing. The companys goal of creating AI accelerators "which are many orders of magnitude faster and more energy efficient than digital processors. If the goal is achieved, it will revolutionize the existing computing landscape and drive the field of AI into a new phase.

From the perspective of technology, Extropic believes that the current digital processors are not suitable for AI acceleration, which is reasonable to certain degree. When traditional computing processors deal with AI algorithms, they have to accept probabilities and uncertainties, resulting in inefficiencies. The probabilistic paradigm proposed by Extropic is closer to the "biological" and "noisy” natural state, which has natural advantages in dealing with probability and uncertain issues in AI algorithms.

Of course, Extropic is also faced with a lot of challenges. First, the development and fabrication of superconducting processors is an extremely complex and difficult task in itself, which requires overcoming numerous technical challenges. Second, even if superconducting processors have been developed successfully, how to integrate them with existing computing ecosystems, and how to ensure their competitiveness in the market have to be considered carefully.

Domestic Trend

XMC enters HBM!(Mar. 17)

As the US government further curbs export of semiconductors to China, China is stepping up its efforts to safeguard its domestic semiconductor supply chain. It is learned that Wuhan Xinxin Semiconductor Manufacturing Co., Ltd. (XMC) recently issued a bidding invitation for its high-bandwidth memory (HBM) project. The Korean industry believes that this indicates that the Chinese storage industry is placing HBM at the forefront of its future development strategy. According to report, XMC has recently started HBM business by issuing bid invitations for building assembly line and developing advanced packaging technology. The company also released the tender project of "High-bandwidth storage core advanced packaging technology R&D and production line construction”, using 3D integrated multi-wafer stacking technology to create higher capacity, greater bandwidth, lower power consumption and higher productive domestic HBM products.  The company proposed to newly install 16 sets of equipment to output more than 3,000 units of wafers (12 inches).

Shanghai Sinyang increases investment in photoresist company!(Mar. 16)

Recently, Shanghai Sinyang Semiconductor Materials Co., Ltd. (Shanghai Sinyang) announced that it plans to increase investment in Zhejiang Xinying Electronic Materials Co., Ltd.  to achieve the completion of the domestic industry chain of key process materials for semiconductors and mass production to help the company’s photoresist products develop in depth and breadth as early as possible.  

In recent years, the domestic semiconductor market is developing rapidly, there is a great demand of photoresist products for semiconductor chip manufacturing. As the domestic market is highly dependent on imports, there is still a vast market space for domestic substitute products. As an enterprise engaged in R&D of key process materials for the semiconductor field, Shanghai Sinyang is committed to building itself into a service provider of high-quality key IC process materials with technologies of electroplating, cleaning, lithography, grinding. After years of R&D and validation, some products of the company have been verified by customers with good effects and have been ordered by some customers.   

Zhejiang Xinying has a photoresist resin R&D team with capabilities of developing raw materials such as photoresist resin, production process technology and quality control, customer technical service ability and other special technologies.

Shanghai Sinyang said that according to its future business expansion needs, it plans to increase investment in Zhejiang Xingying, which benefits the in-depth development of its photoresit business, meets its strategic goals, and helps China to achieve a complete  industry chain of key process materials for the semiconductor field as early as possible and achieve mass production of such materials.

EDA companies work together on RISC-V chip validation(Mar. 19)

Recently, XEPIC, or Accelerating EDA Pioneer Innovation Center, a domestic EDA leader,  and Woodpecker Semiconductor Technology (Zhejiang) Co., Ltd., the global IC verification technology pioneer, announced an exclusive strategic partnership. The two sides decided to jointly advance EDA technical cooperation in the field of chip validation and testing, committed to providing complete, self contained validation and testing solutions for high reliable processor chips such as RISC-V-based vehicle chips. After reaching cooperation, the two sides will create a complete closed technical loop for validation and testing, debugging and diagnostics to provide full chain technicalte support from design, verification to test for complex system chips. 

The person responsible for RISC-V and ecology verification at DAMO Academy confirmed that Woodpecker Semiconductor developed the industrys first QED technology-based auto verification solution for RISC-V CPU, saying: “We are very glad to see the deep cooperation between Woodpecker and XEPIC. We hope that the verification platform of XEPIC will provide a more user-friendly, complete RISC-V verification solution with higher performance to further push the development of RISC-V.” 

Currently, chip verification has been used both for pre-silicon verification but also for improving the quality and effectiveness of post-silicon verification, and can bring competitiveness for any IC companies in terms of cost and time. Woodpecker Semiconductors pre- and post-silicon verification tools, in a systematic and scalable way, are used to increase the productivity and quality of chip verification and testing without additional expertise or engineering resources, changes to IC design implementation processes or validation environment. By automatically converting existing verification test codes, the coverage range can be significantly increased and errors can be resolved much easier.