Major silicon wafer suppliers’ sales last month met market expectations, and the positive effects of their price hikes are expected to persist in the second half of this year, Yuanta Securities Investment Consulting Co (元大投顧) said yesterday.
Wafers are expected to remain in short supply, benefiting major suppliers in the near term, Yuanta said in a research note.
GlobalWafers Inc (環球晶圓) posted record revenue of NT$6.04 billion (US$203.08 million) for last month, up 14.9 percent month-on-month and 25.8 percent year-on-year, which Yuanta attributed to intensive renewals of the company’s long-term agreements in the second quarter, resulting in higher average selling prices.
Photo: Cheng I-Hwa, Bloomberg
“We expect GlobalWafers’ sales to rise by 4 percent quarter-on-quarter this quarter, given the tight 12-inch supply-demand balance,” Yuanta said.
Formosa Sumco Technology Corp’s (台勝科) revenue for last month grew 1.9 percent monthly and 44.7 percent annually to NT$1.36 billion, the highest figure in 40 months, while Wafer Works Corp (合晶科技) reported revenue of NT$1.01 billion for last month, up 2.36 percent from a month earlier and 21.77 percent from a year earlier, company data showed.
In the first five months, GlobalWafers’ combined revenue totaled NT$27.61 billion, up 12.1 percent from a year earlier, while Formosa Sumco’s rose 32.6 percent to NT$6.43 billion and Wafer Works’ increased 27.97 percent to NT$5.05 billion, the data showed.
Yuanta forecast that Formosa Sumco and Wafer Works would continue to increase their average selling prices of products, as they need to conduct price negotiations every six months for many of their long-term contracts.
Coupled with a persistently tight supply of 8-inch and 12-inch wafers, the companies are expected to report a 5 percent upside in price quotes in the second half of the year, the note said.
Last week, Japanese silicon wafer supplier Sumco Corp reportedly planned to raise long-term agreement prices by 30 percent from this year to 2024, while Shin-Etsu Chemical Co proposed raising prices in 2024 to pass on depreciation costs from its new plant to its customers, a Nikkei Asia report said.
Formosa Sumco also said that the 12-inch supply-demand gap would likely grow to 10 percent next year, Yuanta said.
“We believe this development will support a pricing uptrend and be positive for the overall silicon wafer sector,” it said.
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