According to TrendForce’s latest memory spot price trend report, regarding DRAM spot prices, though the top three DRAM suppliers have not lowered their official prices, spot prices could weaken further because buyers are more passive than before. On the other hand, the ample supply of reball DDR4 chips have also depressed the momentum for DDR4’s price hike. As for NAND flash, spot traders are depleting in anticipation on a revitalization of demand for 3Q24 having perceived the sluggishness from the contract market. Details are as follows:

DRAM Spot Price:

Continuing from last week, there has been no noticeable demand rebound in the spot market. Although the top three DRAM suppliers have not lowered their official prices, spot prices could weaken further because spot buyers are more passive than before, and the demand situation for consumer electronics has yet to experience a turnaround. It is worth noting that spot prices of DDR4 products have been rising by a smaller margin compared with spot prices of DDR5 products since the start of this year. Consequently, some module houses are showing willingness to restock DDR4 products. However, there is still ample supply of reball DDR4 chips, so spot prices of DDR4 products reveal no indication of hikes. The average spot price of the mainstream chips (i.e., DDR4 1Gx8 2666MT/s) dropped by 0.35% from US$1.985 last week to US$1.978 this week.

NAND Flash Spot Price:

Spot traders are depleting in anticipation on a revitalization of demand for 3Q24 having perceived the sluggishness from the contract market. Wafer prices have dropped compared to last week, which reflect how traders are hoping to minimize their losses from inventory by attempting to finalize transactions as soon as possible amidst pessimism. Spot prices of 512Gb TLC wafers have dropped by 1.15% this week, arriving at US$3.234.

Eurostat released the July CPI data for the Eurozone on August 20, showing an annual growth rate of 2.6%, slightly up by 0.1% from the previous month and in line with market expectations. The three countries with the lowest annual inflation rates were Finland (0.5%), Latvia (0.8%), and Denmark (1.0%), while the highest rates were observed in Romania (5.8%), Belgium (5.4%), and Hungary (4.1%).

Among the components of the overall CPI, services inflation made the largest contribution, with an annual growth rate of 4.0%, slightly down from 4.1% in the previous month, contributing 1.82 percentage points to the overall CPI increase. This was followed by food, alcohol, and tobacco (0.45 percentage points), non-energy goods (0.19 percentage points), and energy (0.12 percentage points).

According to the European Central Bank’s (ECB) third-quarter professional forecasters’ survey, the CPI growth rate is expected to decline to 2.4% by the end of 2024, with long-term inflation projected to return to the ECB’s 2% target. Additionally, the main refinancing rate is expected to decrease to 3.75% in 2024 (currently 4.25%), with the market anticipating that the ECB will implement a 25 basis point rate cut in both September and December, and further reductions to 3.0% and 2.5% in 2025 and 2026, respectively.

Read more at Datatrack

According to a report from UDN, TSMC held a groundbreaking ceremony yesterday for its Dresden, Germany plant, offering a significant boost to the EU’s efforts to stabilize its chip supply.

TSMC Chairman C.C. Wei led a team of top executives at the event, joined by key officials including German Chancellor Olaf Scholz. European Commission President Ursula von der Leyen also attended, bringing with her the announcement that the EU has approved a EUR 5 billion subsidy for the Dresden plant.

TSMC announced last August that it would partner with Bosch, Infineon, and NXP Semiconductors to establish the European Semiconductor Manufacturing Company (ESMC) in Germany.

The joint venture will construct a 12-inch wafer plant, with TSMC holding a 70% stake, while Bosch, Infineon, and NXP each hold 10%. Construction is planned to start in the second half of this year, with mass production expected by the end of 2027.

The planned fab is expected to have a monthly production capacity of 40,000 12-inch wafers on TSMC’s 28/22 nanometer planar CMOS and 16/12 nanometer FinFET process technology.  TSMC will be responsible for the plant’s operations.

Following the U.S.-China tech war, the EU passed the “Chips Act” to fully support the development of the semiconductor industry, attracting key investments from companies such as TSMC, Intel, Belgium’s IMEC, GlobalFoundries, and GlobalWafers, all of which sought subsidies for their new European operations.

TSMC’s joint venture proposal, exceeding EUR 10 billion, stands as the largest global direct investment in Saxony’s history.

When C.C. Wei took the stage, he began by thanking the German government. He revealed that when he first met with the German Chancellor, he had prepared a polite speech to decline the offer of building a plant in Germany.

However, when the Chancellor mentioned that a budget had already been reserved for TSMC, Wei eventually found himself agreeing to the project.

C.C. Wei further highlighted that TSMC’s total investment in the German plant exceeds EUR 10 billion and is expected to create around 2,000 jobs.

He explained that the decision to locate the plant in Dresden was due to its proximity to TSMC’s customers and access to a large pool of talented individuals. Wei also pledged to continue recruiting and nurturing talent in the region, with the goal of making ESMC the most important semiconductor manufacturing hub in Europe.

Read more

• [News] TSMC Maintains Overseas Expansion Strategy, Unfazed by Geopolitical Disruptions
• [News] TSMC’s German Plant Reported to Break Ground in Weeks, Expected to Begin Production by Late 2027

(Photo credit: TSMC)

Recently, two industrial moves took place in Shanghai’s integrated circuit (IC) sector.

First, the Shanghai Integrated Circuit Industry Investment Fund (Phase II) Co., Ltd. (hereinafter referred to as “Shanghai IC Industry Fund Phase II”) received a substantial capital increase.

Second, 14 key IC-related projects were signed and officially launched in Shanghai’s Lingang area on August 19, involving companies such as SICC, JHETECH, SIMIC, and Shanghai Institute of IC Materials (SICM) with a total investment of CNY 28.8 billion.

• The Capital of Shanghai IC Industry Fund Phase II Increased to CNY 14.5 Billion

Recently, the business registration information of Shanghai IC Industry Fund Phase II was updated, showing a significant increase in registered capital from CNY 7.6 billion to CNY 14.53 billion. Moreover, Shanghai Pudong Innovation Investment Development (Group) Co., Ltd. was added as a new shareholder, and some key personnel changes were made.

The Shanghai IC Industry Fund was founded in 2020. In June 2024, Shanghai AST announced the successful completion of its Series C financing round, with Shanghai IC Industry Fund Phase II among the investors, which has also invested in companies such as Hailin Microelectronics, SMIC, JCET, and GTX.

It is worth noting that this is the second capital increase for Shanghai IC Industry Fund Phase II. It’s learned that the fund’s initial registered capital was CNY 5.4 billion, which increased to CNY 7.6 billion in January 2022.

• Several IC Industry Funds Established

In 2016, Shanghai Integrated Circuit Industry Investment Fund Co., Ltd. (hereinafter referred to as “Shanghai IC Industry Fund Phase I”) was established with an initial fundraising scale of CNY 28.5 billion, making it the largest local IC industry fund in China at that time, with a focus on investing in IC manufacturing sector.

The National Integrated Circuit Industry Investment Fund ( “Big Fund”) was among the investors, currently holding a subscribed capital of CNY 3 billion and a 17.01% stake.

Up till now, Shanghai IC Industry Fund Phase I has invested in 14 companies, including HLMC Microelectronic, Hailin Microelectronics, Everdisplay, SMIC, GTA, HLMC IC, SouthChip, Zhaoxin, Unisoc, InnoGrit, and ACM, covering areas such as design, manufacturing, and equipment.

In July 2024, following the establishment of Shanghai IC Industry Fund Phase I and Phase II, Shanghai took further action by setting three new leading industry mother funds. It is reported that the funds invested a total of CNY 89.003 billion, respectively targeting three major industries: IC, biomedicine, and AI.

Among these, the IC mother fund has a capital of CNY 45.001 billion, focusing on areas including but not limited to IC design, manufacturing, packaging and testing, equipment materials, and components.

The AI mother fund, with a scale of CNY 22.501 billion, eyes fields such as intelligent chips, intelligent software, autonomous driving, and intelligent robots.

Read more

• [News] China Imports 32 Lithography Systems in 2 Months, Shanghai and Beijing Top Buyers
• [News] Surge in Chip Manufacturing Equipment Imports from the Netherlands to China, Soaring Tenfold After U.S. Tightens Restrictions

(Photo credit: JCET)

China has long been the preferred location for tech companies to establish their supply chains. However, in recent years, the decline in population dividends has led to rising labor costs, and the need for tech companies to mitigate the impact of geopolitical risks has prompted them to accelerate the relocation of supply chains out of China, with some shifting production capacity to Southeast Asia and South Asia.

Recently, as per a report from TechNews citing sources, it’s indicated that HP is considering moving more than half of its personal computer production away from China to countries like Thailand and Vietnam.

This move is primarily aimed at significantly reducing its reliance on China’s supply chain, as well as addressing global trade dynamics and the need to lower costs.

In addition to HP, several well-known tech companies are also shifting their supply chains to Southeast Asian and South Asian countries.

• Apple

One notable example of supply chain relocation is Apple. Having long relied on China’s supply chain, Apple is now finding that the era of full dependence on China is coming to an end due to political and commercial pressures.

iPhone

As one of Apple’s most important products, iPhone has been a key focus in this shift.

Although supply chain diversification was always part of Apple’s strategy, the plan has been accelerated following a series of disruptions at Foxconn’s Zhengzhou plant during the pandemic. These events have compelled Apple to expedite its efforts to diversify its supply chain.

According to a report from Business Standard, since April of this year, Apple has assembled iPhones worth USD 14 billion in India, with 14% of iPhones now being manufactured there.

Rajeev Chandrasekhar, India’s former Union Minister of State for Electronics and Information Technology, also stated on the X platform that by 2028, it is estimated that up to 25% of iPhones will be made in India.

iPad

In addition to iPhone, Apple has also started shifting part of its iPad production to Vietnam. Foxconn is responsible for manufacturing iPads in Vietnam, where mass production and shipments are already underway.

MacBook

Similarly, the MacBook production line has been partially moved out of China and relocated to Vietnam, which is primarily produced by Quanta and Foxconn in their Vietnamese facilities.

Earlier rumors cited by Nikkei have suggested that Apple was considering shifting some of its production to Thailand as well. However, Thailand’s supply chain for key components is not yet fully developed, with many parts still reliant on imports from China.

The associated transportation costs and the risk of potential damage during transit have led Apple to prioritize setting up production lines in Vietnam first.

Nevertheless, Thailand’s strong electronics manufacturing infrastructure and cost advantages make it a potential future production site for Apple.