Semiconductor Exports Increase, Strong Performance Expected to Continue in Q4

(Semiconductor stock photo)

[Asia Economy Reporter Changhwan Lee] Semiconductor exports in September exceeded expectations, raising hopes for an improvement in the semiconductor industry outlook.

According to the Ministry of Trade, Industry and Energy on the 4th, South Korea's semiconductor exports last month reached $9.5 billion, an 11.8% increase compared to the same period last year. It surpassed $9 billion for the first time this year and continued its growth for three consecutive months following July and August.

The improvement in semiconductor exports is attributed to several factors. First, as the U.S. intensified semiconductor sanctions against Huawei, Huawei purchased more Korean semiconductors than usual to secure inventory.

It is known that Huawei concentrated its semiconductor purchases from Samsung Electronics and SK Hynix until the 15th of last month, when the U.S. sanctions officially began.

In addition to Huawei's impact, exports increased overall. Hana Financial Investment explained that the reason for the strong semiconductor exports was not only the one-time effect of Huawei but also because the mobile markets in the U.S., Europe, and India experienced less-than-expected sales declines due to COVID-19, and the demand for laptops continued to rise due to the expansion of remote work and online education.

The securities firm stated, "According to government announcements, the data includes information that can gauge the strong performance of semiconductor process material suppliers as well as semiconductor exports," adding, "Exports of hydrogen peroxide (+21%), sodium hydroxide (+357%), and ammonia solution (+39.8%) among fine chemical raw materials recorded positive growth for the first time in six months, which is meaningful due to demand recovery."

Hydrogen peroxide is used in semiconductor processes for photoresist removal and wafer cleaning. Sodium hydroxide (NaOH) is used for wafer polishing and etching. Ammonia (NH3), in gas form, is used in the process of forming nitride films by combining with monosilane (SiH4) or trimethylgallium (TMGa), and is recognized for its potential as a raw material for high-purity hydrogen.

It is also noteworthy that wafer exports, which had been relatively slow to improve within the semiconductor sector, increased by 19.5% year-on-year as of September, showing strong performance. Among wafers, inventory levels for memory semiconductor wafers remain high, but inventory levels for non-memory semiconductor wafers are relatively favorable, suggesting smooth accumulation of wafer inventory.

Furthermore, Hana Financial Investment analyzed that the fact that DRAM exports, which had fluctuated due to product price declines among major semiconductor items, have stabilized for five consecutive months supports the conclusion that semiconductor exports in September were strong. DRAM recorded negative growth year-on-year in April this year but has shown positive growth for five months from May to September, with +17.4%, +8.3%, +10.9%, +11.3%, and +18.8%, respectively.

Semiconductor exports in the fourth quarter are also expected to show positive growth compared to the previous year. Kim Kyung-min, a researcher at Hana Financial Investment, forecasted, "Since monthly semiconductor exports in the fourth quarter of last year were all below $8 billion, it is highly likely that semiconductor exports in the fourth quarter of this year will continue to show positive growth compared to the same period last year."

This content was produced with the assistance of AI translation services.