The US Department of Commerce on Tuesday said that a global survey of semiconductor chip producers and users shows a shortage will persist, sparked primarily by wafer production capacity constraints.
The voluntary survey of 150 companies last fall in the supply chain confirmed “there is a significant, persistent mismatch in supply and demand for chips, and respondents did not see the problem going away in the next six months.”
US Secretary of Commerce Gina Raimondo told reporters that the department “in a few instances didn’t really get what we needed and we’re going to go company by company and do personal engagement and get what we need.”
Photo: AP
Raimondo said in November that she had spoken to “all of the CEOs in the supply chain — including Samsung, TSMC [Taiwan Semiconductor Manufacturing Co, 台積電], SK — and all of the CEOs have pledged to me that they will be submitting robust and complete data flows to us.”
Some companies in Asia and governments had earlier expressed concern about the data request.
Raimondo reiterated that the department could invoke its legal authority to get responses.
The Ministry of Economic Affairs, responding to the survey, reiterated that Taiwanese companies are working hard to produce chips and coordinating with “important international business partners” to strengthen supply chains.
The US could compel foreign semiconductor firms with US operations to answer detailed questions about the chips market.
Raimondo on Tuesday declined to say who did or did not comply.
The department also said it was sharing its findings with foreign governments.
It said it had seen some unusually high prices among some chips used by automakers and medical device manufacturers.
The department said that it would “engage industry on node-specific problem solving in the coming weeks. We will also look into claims about unusually high prices in these nodes.”
“Demand for chips is high. It is getting higher,” Raimondo said, adding that demand is now about 20 percent above 2019 levels.
“There is not a lot of good news” in this survey, she said.
Raimondo said the survey did not show evidence of hoarding.
The department said median inventory for consumers for key chips has fallen from 40 days in 2019 to less than five days last year.
“Five days of inventory. No room for error,” Raimondo said. “That tells you how fragile this supply chain is.”
US President Joe Biden has been pressing the US Congress to approve more funds to boost chip production in the US as shortages of the key components used in autos and computers have exacerbated supply chain bottlenecks.
The US House of Representatives on Tuesday unveiled its legislation to bolster US research and development to better compete with China, and aid the domestic semiconductor industry, in a bid to negotiate a final bill this year with the US Senate.
“Major components of this package have already passed the House with overwhelmingly bipartisan votes, and we look forward to conferencing this bill with the Senate to get legislation to the president’s desk as soon as possible,” US House of Representatives Speaker Nancy Pelosi said in a statement.
The bill is a priority for Biden’s administration, particularly the nearly US$52 billion in grants and incentives for the semiconductor industry amid a global chip shortage.
The House bill includes the same US$52 billion in emergency appropriations to help the semiconductor industry that the Senate bill incorporated as part of the CHIPS for America Act.
In addition, it also authorizes US$45 billion for grants and loans to support supply chain resilience and manufacturing of critical goods in the US.
Additional reporting by Bloomberg
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