China provides only 6% of its own needs for semiconductor products

China provides only 6% of its own needs for semiconductor products

According to IC Insights, companies headquartered in China produced $ 8.3 billion in chips in 2020, which is 5.9% of the country’s total $ 143 billion chip market. This is a very modest result if remember that under the Made in China program, Beijing has set a target to meet 70% of its domestic demand by 2025.

Logic integrated circuit sales accounted for the largest share of the Chinese chip market in 2020, with MPU (microprocessor) and DRAM also among the top three semiconductor product categories in the Chinese market, analysts at IC Insights said in a recent report.

As a reminder, China became the largest chip market in the world back in 2005 and has continued to grow ever since. In 2020, the Chinese integrated circuit market grew to $ 143.4 billion, up 9% from 2019, when it was valued at $ 131.3 billion. IC Insights estimates that 60% ($ 86 billion) of the Chinese chip market came from exported products and 40% of the market ($ 57.4 billion) – for systems that remain in the country.

Logic integrated circuits were the top gainers, accounting for 26% ($ 37.5 billion) of the Chinese market last year. IC Insights predicts that the logic chip market will remain the largest semiconductor segment in China until 2025, with a CAGR of 10.5% during this period.

Strong smartphone sales in China and around the world, as well as growth in sales of various computer systems throughout the year due to quarantine restrictions due to COVID-19, resulted in microprocessors becoming the second largest chip segment in China last year. MPU sales rose 12% in 2020 to $ 32.7 billion (22.8% of the country’s total chip market).

DRAM memory chips accounted for 19% of the Chinese market in 2020. And if you add NAND flash memory to that, all memory accounts for 30% of the Chinese chip market. China’s high memory consumption is fueling the country’s passion for large-scale local DRAM and NAND production.

Today, the Asia-Pacific region, including China, forms 63.8% of the global chip market, and in 2025 this region’s share will already be 68.1%. While China has remained the largest chip consumer country since 2005, it is not yet a major chip maker.

Of all chips sold in China in 2020, only 15.9% were made in China. And if we take into account only companies headquartered in this country, then we are talking only about 5.9%. So far, most of the chips produced in China are accounted for by foreign companies such as TSMC, SK Hynix, Samsung, UMC.

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