Materials have become the Achilles heel of China's semiconductor industry

Source: Content from Economic Information Daily, thank you.

Materials science is the basic science of strategic emerging industries and is crucial to my country's implementation of the innovation-driven development strategy. However, at present, my country's competitiveness in this field is worrying. On the one hand, the core key materials are highly dependent on foreign countries and key technologies are missing; on the other hand, some projects are "rushed into it", resulting in industrial structural overcapacity. Some people bluntly said that "the urgently needed new materials cannot be found, those that can be found cannot be made, and those that can be made cannot be made well."

At present, some places such as Shenzhen have formed a "magnetic effect" through "policy guidance + market environment", attracting the world's top new material innovation talents to start businesses. Some experts suggest that it is still necessary to improve the system and take multiple measures to give full play to the role of market entities such as venture capital to help the development of the industry.

New materials industry develops rapidly

In May 2016, Deng Fei, a PhD from the University of Tokyo and a researcher at the Composite Materials Center of the University of Delaware, resigned from his position and registered Enwan Technology in Shenzhen. Enwan Technology has developed mass-produced carbon nanotube fiber materials. Carbon nanotube fiber is a macro fiber made by twisting many single nanotubes together. It is lightweight, high-strength and multifunctional. It is a new generation of special fiber materials with performance exceeding the composite materials made of carbon fiber currently used in aerospace.

Enwan Technology is just a microcosm of the many "material black technologies" that have "gathered and taken root" in Shenzhen. "In recent years, the scale of Shenzhen's new materials industry has increased from 59 billion yuan in 2010 to 150 billion yuan in 2015," said Li Yin, secretary general of the Shenzhen New Materials Industry Association. Shenzhen has more than 100 innovation carriers in the field of new materials, nearly 40 listed companies, more than 400 national high-tech enterprises, more than 10,000 related patents in the field of new materials, and has compiled or participated in the formulation of more than 400 standards, showing a rapid development trend.

BFM Materials Technology Co., Ltd. was founded in Shenzhen in the second half of 2016. Its co-founder and chief scientist, Fang Xuanlai, is a tenured professor in the Department of Mechanical Engineering at the Massachusetts Institute of Technology. The micro-nanoscale 3D printing technology developed by his team was named one of the top ten disruptive innovative technologies of the year by MIT Technology Review in 2015.

Dr. Zhang Xiaojun from the University of California, Berkeley, together with Dr. Li Zhefeng from Harvard University's Department of Chemistry and Dr. Ding Bo from the University of Pittsburgh's Department of Materials Science, formed a high-throughput material research and development team, gave up their jobs as researchers at Fortune 500 companies, and started a business in Shenzhen. They named their company "Matrix New Materials" because they can prepare and test different materials in batches on a substrate, just like forming an array like a matrix. This technology is also one of the key technologies in the Materials Genome Project.

Greatly compressing the size of mobile phone cameras, reducing the weight of large equipment while maintaining the same strength and hardness... At the 18th China Hi-Tech Fair held in Shenzhen last year, Fang Xuanlai released a micro-nano scale 3D printing system technology with independent intellectual property rights that can "shrink" materials, which attracted attention from all parties.

Micro-nanoscale 3D printing (micro-nanostructure additive manufacturing) is one of the world's most advanced manufacturing fields. It is an advanced micro-machining technology that transforms digital computer models into solid objects by building many extremely thin layers. The complex three-dimensional micro-nano structures formed by this technology have huge industrial demands in the fields of micro-nano electromechanical systems, biomedicine, tissue engineering, new materials, new energy, high-definition displays, biochips, etc.

"The materials that we are familiar with, such as plastics, metals, and ceramics, have been shrunk through the micro-nano scale 3D printing system." Chen Linsen, dean of the Soochow University High-Tech Industry Research Institute, said that he hopes to achieve mass production of nanostructured composite materials in the future to usher in a new era in the field of materials.

The self-sufficiency rate of key new materials is worrying

Many experts believe that the materials industry is the foundation of the entire industrial system. The invention and application of revolutionary new materials have been leading the global technological innovation, promoting the transformation and upgrading of high-tech manufacturing, and giving birth to many emerging industries. However, materials science has its own particularity, with large R&D investment and long R&D cycle. my country's self-sufficiency rate of key new materials is still very worrying, and the urgency of reducing external dependence on core key materials is becoming more and more prominent.

Wang Hong, an expert of the “Thousand Talents Plan” and professor of the China Building Materials Research Institute, believes that my country’s materials science and technology industry started late. Despite years of research and development, there is still a gap in the overall level with advanced countries, which restricts the development of many major strategic fields.

First, one of the common problems faced by many new material enterprises in the process of development is the lack of strong technical support. While industries such as photovoltaics, wind power, electric vehicles, and LEDs are booming, the demand for new materials such as polysilicon, carbon fiber, and lithium electronics is increasing day by day. Many places are "rushing" to these projects; some regions have seen structural overcapacity in the industry, and many companies are facing a difficult operating environment, but they have not yet mastered core technologies.

At the same time, the traditional material development method is mainly trial and error, that is, using existing theories and experience about materials, adjusting the material ratio, conducting characterization tests and inspections, and finally finding materials that meet the needs. According to some industry experts, the traditional method leads to a long material development cycle, which is far from meeting people's demand for new materials. The empirical, trial-and-error, and discrete material development methods need to be changed.

Mao Sheng, director of Shenzhen Guoxin Energy Research Institute, took the search for photocatalytic materials for solar photocatalytic water splitting to produce hydrogen as an example: for the base material titanium dioxide, 5 doping elements were selected from 50, and 3 co-catalytic materials were selected from 30; during the synthesis process, 2 chemical raw materials were selected, 4 reaction temperatures, and 2 reaction times were selected; "In this way, a total of 360,000 experiments were required. If one experiment was performed per day, it would take about a thousand years to complete."

In addition, the old material standards also hinder the promotion and use of new materials. An entrepreneur engaged in the production of graphene anti-corrosion coatings told the Economic Information Daily reporter that traditional anti-corrosion coatings have certain requirements for zinc content, which is certainly conducive to ensuring product quality. However, as a new product, graphene anti-corrosion coatings utilize the excellent properties of graphene and can reduce zinc content while improving anti-corrosion efficiency. If the traditional requirement of reaching a specific zinc content is still used as the standard, then this new product will be "unqualified", making it impossible to promote it.

Catalyzing the industry with “policy guidance”

At present, most strategic emerging industries are material-intensive industries, such as photovoltaics, lithium batteries, lightweight alloys for vehicles and wind turbine blades, fuel cell diaphragms, etc. However, many industry insiders believe that my country's core competitiveness in the field of new materials is worrying. "The urgently needed new materials cannot be found, those that can be found cannot be made, and those that can be made cannot be made well."

A reporter from the Economic Information Daily recently conducted research in Shenzhen and learned that Shenzhen mainly uses the "policy guidance + market environment" approach to form a "magnetic effect" and then promote the "scale effect" that catalyzes industrial development.

In 2011, the Shenzhen Municipal Government issued the "Shenzhen New Materials Industry Revitalization and Development Plan", proposing that starting from that year, Shenzhen would allocate 100 million yuan each year for special funds for major high-tech projects, scientific and technological research and development funds, and technological progress funds for five consecutive years. Shenzhen’s fiscal revenue would increase by 200 million yuan, with 500 million yuan concentrated each year to establish a special fund for the development of the new materials industry, which will be used to subsidize the core technology research and development of the new materials industry, the construction of industrialization projects, etc.

After more than five years of hard work, an internationally renowned and domestically leading new material industry base has taken shape. Deng Fei said that in the field of material innovation, Shenzhen has successively cultivated Light Space Science, which is committed to the industrialization of metamaterials, and Royole Technology, which is committed to the application of flexible display materials. Their success has injected great motivation into material researchers.

The "Peacock Plan", which also started in 2011 and is quite unique to Shenzhen, provides special funding of up to 80 million yuan for innovation and entrepreneurship for overseas high-level talent teams through the confirmation mechanism of "direct recognition + review". Many new material innovation and entrepreneurship teams in Shenzhen started with the help of the "Peacock Plan".

"New materials are a key factor in the transformation and upgrading of the manufacturing industry. Shenzhen is located in the hinterland of the Pearl River Delta, the world's factory. It has a large manufacturing industry and strong motivation for transformation and upgrading. It also has the location advantage of being adjacent to Hong Kong and can radiate to the world. It is the preferred place for new material application research and industrialization." said He Xiaoning, CEO of BMF Materials.

Less than half a year after its establishment, the multi-precision and multi-material micro-nano 3D printing system independently developed by BFM has been adopted by domestic and foreign research institutions, including the Massachusetts Institute of Technology, Masdar Institute of Technology in the United Arab Emirates, and the National Key Laboratory of Microstructures of Nanjing University. Matrix New Materials has signed a multi-million-yuan contract with Shenzhen Eneson Technology Co., Ltd., a large domestic molten salt research and development, production and sales company, to provide it with research and development, preparation and testing services for new molten salt materials.

The market-oriented financing environment is also helping to form a "magnetic effect." Li Wei, founding partner of Shenzhen Songhe Capital Management Co., Ltd., said that the threshold for new material venture capital investment is high and the cycle is long, but Shenzhen's developed venture capital industry has enabled some people who have technology but do not want to start a business to muster the courage to join the entrepreneurial wave.

Urgent need to take multiple measures to improve the system

The 13th Five-Year National Strategic Emerging Industries Development Plan issued by the State Council pointed out that "we will strengthen the layout of cutting-edge materials", "improve the application level of new materials, and promote the integration of new materials into the high-end manufacturing supply chain", and "by 2020, we will strive to make a number of new materials enter the global supply chain, and the self-sufficiency rate of major key materials will reach more than 70%, and initially realize the strategic transformation of my country from a major material country to a strong material country."

Many industry experts suggest that we can learn from Shenzhen’s relevant development experience and take multiple measures to give full play to the role of market entities such as venture capital to help the development of the new materials industry.

First, further build a highland of new material innovation. In recent years, Shenzhen's new material industry has taken a leading position in the country, with an annual growth rate of 20%, and a number of enterprises with internationally advanced technologies and industry leaders have emerged. Some experts suggest that in areas such as Shenzhen where new materials are developing rapidly, the foundation is good, and industrial transformation is relatively mature, we can further build a world-class new material innovation highland, talent gathering highland, and industrial development highland.

Second, continue to refine and issue relevant industrial support policies. The reporter learned from the survey that the introduction and investment of many top overseas technology entrepreneurial teams in Shenzhen are completed by market-oriented venture capital institutions. Many industry insiders suggest that professional investment funds such as government-guided funds should actively participate in supporting the development of the new materials industry and continue to provide appropriate guidance for industrial development.

Third, in the field of innovation such as new materials, we will explore the QDLP (Qualified Domestic Limited Partner) model of the venture capital market. At present, many overseas innovation teams introduced to Shenzhen register and establish companies in China, and then venture capital invests in them. Since these innovation teams usually conduct basic research and development abroad and apply research and development and industrialization in China, they have funding needs both at home and abroad.

Many people in the venture capital industry said that due to relevant policy restrictions, RMB funds can only invest in companies with innovative teams in China, and the funds they raise in China are difficult to use overseas. It is recommended to explore the QDLP model of the venture capital market in specific fields such as new materials, so that domestic funds can directly invest in overseas innovative projects more efficiently.

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