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China's Semiconductor Equipment Imports Hit a Record High in the First Seven Months Of 2024
Published: 8.27.2024
The latest trade data released by the General Administration of Customs of China showed that Chinese companies imported nearly $26 billion worth of chip manufacturing equipment, exceeding the highest value in 2021.
As the United States, Japan and the Netherlands have tightened their control over Chinese companies' access to the most advanced semiconductor equipment, Chinese manufacturers have now turned to purchasing more low-end equipment, especially from companies such as Tokyo Electron of Japan, ASML of the Netherlands and Applied Materials of the United States.
Data shows that China imported nearly $40 billion worth of semiconductor equipment in 2023, an increase of 14% from 2022. Among them, the import value in the third quarter reached 63.4 billion yuan, a year-on-year increase of 93%.
In addition, in order to ensure the security of the supply chain and guard against the tightening export control measures of the United States and its allies, the Chinese government has also taken a series of measures to promote semiconductor companies to increase investment and speed up stocking. One such measure is a joint policy by the Ministry of Finance, General Administration of Customs, and State Administration of Taxation that exempts certain integrated circuit companies from import tariffs.
China's semiconductor equipment imports remain robust in 2024, exemplified by a 290.4% year-over-year surge in purchases from the Netherlands' ASML during the first quarter, reaching $2.167 billion.
In July, Dutch exports to China reached a new record of over $2 billion, marking the second time this milestone has been achieved. ASML, a Dutch company, saw its sales to China surge by 21% in the second quarter, accounting for half of its total revenue. These sales primarily consisted of older, unrestricted semiconductor equipment systems.
According to SEMI, in June, Chinese chip manufacturers' output was expected to increase by 14% in 2025, reaching 10.1 million wafers per month, accounting for nearly one-third of global production.
SEMI also predicted that the global semiconductor equipment market would rebound and reach a record high in 2024 and 2025. Mainland China's semiconductor equipment purchases account for nearly 30% of the global market.
The U.S. has been pressuring Japan and the Netherlands to impose stricter controls on China's advancement in critical technologies like semiconductors and AI, particularly limiting the sale of advanced chips and manufacturing equipment. To counter these efforts, China must prioritize increasing its self-sufficiency, especially in key manufacturing equipment.
In the past few years, China's semiconductor equipment self-sufficiency rate has continued to increase, but it is still at a relatively low level compared with the global market, and there is a large space and potential for localization. However, as Chinese storage/foundry manufacturers have entered the peak period of equipment procurement, the local supporting capacity of domestic key equipment has been significantly improved, and growth is expected to accelerate.
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