Silicon wafer prices fell for the first time in three years

In the semiconductor silicon wafer market, when long-term customers requested to delay the delivery of goods, the spot price has recently begun to lead the decline. This is the first time since the outbreak of the epidemic in more than three years. Crystal, Taiwan Sembcorp, Hejing and other Taiwanese factories are in the market outlook. Manufacturers do not deny that at this stage, the inventory of silicon wafers at the fab end is "too much to full", and it still needs time to digest.

Silicon wafers are essential raw materials for the production of TSMC, Intel, Samsung, UMC and other fabs. They are a key indicator for observing the dynamics of the semiconductor industry. In particular, the spot price is closer to the current market conditions and can reflect market trends in the first place than the contract price.

In response to market changes, Universal Crystal has a high proportion of long-term contracts. The company stated that the contract price remains unchanged, and the support for customers is to help with delivery dates, and the spot price is determined by market supply and demand.

Taiwan Sembcorp also has many long-term contracts. The company pointed out that the first half of this year may be a bit difficult, but it is expected to return to normal in the second half of the year. Hejing said that the price of 8-inch silicon wafers is stable, and some of them are adjusted in line with the rhythm of customers' purchases; 6-inch products are adjusted in line with customers' inventory, and the related shipments in the first quarter are expected to decrease slightly.

At this stage, some silicon wafer spot quotations in the industry are updated every three months, and most of them are updated every six months. The silicon fab admitted frankly that it accepts spot price adjustments, because "now we must first seek to be able to sell."

An unnamed industry player revealed that under the influence of interest rate hikes, inflation and other factors, market terminal demand has shrunk. In the fourth quarter of last year, it was reported that the spot price of silicon wafers began to loosen. Recently, prices have begun to drop, which is the first time since the outbreak of the epidemic in more than three years. .

Some silicon fabs also admitted that the visibility is relatively weak now, and second-tier customers are more affected by market conditions than first-tier factories. After agreeing to delay part of the purchase, it remains to be seen whether customers can really get the agreed quantity throughout the year. In addition, the exchange rate trend of the New Taiwan dollar is difficult to grasp, and exchange losses may also be a challenge this year.

It is understood that the spot price of 6-inch silicon wafers, which has relatively the weakest demand, has dropped by a single-digit percentage this quarter; as for 8-inch silicon wafers, there are items with a slight drop in spot prices, and there are also small increases due to continued short supply. Items, on average, do not change much. The spot quotation for 12-inch silicon wafers is relatively stable, but the manufacturer does not deny that some customers have requested price reductions, and the two parties are negotiating.

Silicon wafer manufacturers revealed that in the fourth quarter of last year, the utilization rate of customer capacity decreased significantly. Now the situation of high customer inventory is really serious, and inventory adjustment is bound to be carried out; needless to say, the situation of storage end production reduction and capital expenditure cut, even wafer The inventory level of some silicon wafers in foundries has been as high as five or six months, which is tantamount to "too much to full". Of course, they are unwilling to purchase more goods or even ask for price bargaining.

While the spot price of silicon wafers has turned down, the contract price has not yet loosened. However, customers have successively requested to postpone the purchase, and the original purchase volume in the first half of the year will be postponed to the second half of the year.

Manufacturers pointed out that the follow-up long-term contract performance status and long-term contract price trend will be the key to the operation of silicon wafer fabs this year. If the long-term contract price can be maintained and customers are also making up for the subsequent purchase volume, related manufacturers still have the opportunity to fight hard Operational growth.