[News] China and Russia’s Semiconductor Equipment Rise

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In recent years, numerous countries have ramped up their efforts to develop the semiconductor equipment industry to secure a competitive position in the global semiconductor value chain. The upstream semiconductor equipment market is becoming increasingly competitive, with China and Russia making notable advancements.

China’s Rapid Growth in Semiconductor Equipment Development

The leading players in the global semiconductor equipment market are predominantly based in the United States, the Netherlands, Japan, and South Korea, holding dominance in critical areas such as lithography, etching, and deposition. In recent years, driven by fab expansions and localization efforts, Chinese semiconductor equipment companies have been increasing R&D investments and achieving notable progress.

While China still faces significant gaps in high-end lithography equipment, especially EUV lithography machines, it has made strides in areas like etching, CVD, PVD, and packaging and testing equipment, gradually capturing market share and advancing domestic substitution.

(Photo credit: DRAMeXchange)

Warnings from China’s Semiconductor Equipment Market

As 2024 comes to an end, signals of potential challenges are emerging in China’s semiconductor equipment market. According to data from the Semiconductor Equipment and Materials International (SEMI), “China’s semiconductor equipment purchases in 2024 are expected to reach a record high, surpassing $40 billion for the first time. However, as demand normalizes in 2025, the market will likely see a decline.”

Industry experts attribute the peak in 2024 to factors like accelerated localization, increased demand for advanced processes, new fab construction, and global supply chain security concerns. Yet, once these production lines become operational, equipment demand is expected to stabilize, and the industry may no longer experience such concentrated purchasing peaks.

Despite potential short-term downturns, the long-term outlook remains optimistic. With the continuous growth of China’s semiconductor industry, advancements in technology, and ongoing localization efforts, the semiconductor equipment market in China is expected to maintain steady growth, especially driven by emerging applications in 5G, AI, and automotive electronics.

Russia Accelerates Development of Domestic Semiconductor Equipment

According to CNews, Russia’s Ministry of Industry and Trade has initiated the development of equipment for manufacturing 200mm wafers used in chip production at technology nodes ranging from 180nm to 90nm. This project has received funding of over 1.7 billion rubles (approximately USD17.73 million) and is part of Russia’s efforts to establish domestic lithography production lines.

The commissioned semiconductor equipment will focus on chemical-mechanical polishing (CMP) of dielectric layers such as silicon dioxide, tungsten, and copper.

Additionally, as reported by CNews in October, the Russian government has allocated over 240 billion rubles (USD 2.54 billion) to support the development of domestic semiconductor manufacturing equipment, CAD tools, and raw materials. By 2030, Russia aims to replace around 70% of its imported semiconductor equipment and materials with domestically produced alternatives.

This ambitious plan, formulated by the Ministry of Industry and Trade, the Russian International Science and Technology Center (ISTC), and MIET (Moscow Institute of Electronic Technology), covers various aspects of semiconductor manufacturing, including technical equipment, materials, chemicals, and CAD systems. Over 50 organizations are involved, with 41 R&D projects already underway in 2024. An additional 26 projects are set to launch in 2025, and 43 more are planned for 2026, bringing the total to 110 projects.

Current State of Russia’s Semiconductor Market

Russia’s leading chip manufacturers, such as Angstrem and Mikron, are still limited to mature process nodes like 65nm and 90nm, heavily reliant on imported semiconductor manufacturing equipment, particularly lithography systems. According to Yakov Petrenko, head of ISTC MIET, Russia currently uses at least 400 different models of semiconductor manufacturing equipment, of which only 12% are produced domestically.

(Photo credit: Naura)