South Korea is building its own hydrogen fluoride production line. Is Japan digging its own grave?

According to Korean media etnews, industry experts pointed out that South Korea has found short-term, medium-term and long-term solutions to deal with Japan's restrictions on the export of three key semiconductor materials. Once the Korean industry forms a stable supply system, the Japanese industry will be hit hard by the current regulatory rules.

A senior official from South Korea's semiconductor industry said that South Korea is almost ready with a solution to supply hydrogen fluoride, and South Korea's semiconductor factories will not stop production even under the supervision of the Japanese government.

It is understood that the short-, medium- and long-term solutions for the Korean industry are: ensuring inventory, diversifying suppliers and localizing products.

A representative of the Korean materials industry pointed out that Korean semiconductor factories plan to fully diversify their suppliers from the end of this month. It can be seen that the substitute of Japanese hydrogen fluoride will be used after passing the test, "although it still needs to be evaluated in the end, if there are no major problems, its production will be replaced."

According to reports, hydrogen fluoride with the same purity as Japan's hydrogen fluoride will be mass-produced in South Korea between September and October. Because SoulBrain, a South Korean semiconductor material company, will expand its factory next month, once its factory is put into operation, the company will be able to meet all the hydrogen fluoride needed by Samsung Electronics and SK Hynix. It is reported that SoulBrain has the technical ability to produce ultra-high purity hydrogen fluoride, so its products can be comparable to Japan's hydrogen fluoride in terms of quality.

However, SoulBrain needs to import hydrogen fluoride from the American materials company Stellar, and then purify it to produce ultra-high purity products. In addition, SoulBrain also purchases production raw materials (anhydrous hydrogen fluoride) from Chinese companies.

It is understood that in addition to SoulBrain, some other Korean companies are also stepping up the research and development of local materials. SK Materials has stated that it will provide gaseous hydrogen fluoride samples by the end of this year.

Although South Korea has not yet been able to produce EUV photoresist, reports say that South Korea's semiconductor industry can still bring in sufficient inventory through other channels. Since the usage rate of this material is currently low, inventory can be easily guaranteed.

Recently, Japan has loosened its stance on South Korea and approved individual licenses requested by Japanese companies to export EUV photoresists to South Korea. However, South Korea seems to be determined to establish a new semiconductor material supply system.

"We can completely get rid of our dependence on Japanese hydrogen fluoride by the end of this year," said a senior official in South Korea's semiconductor industry. "Although the Japanese government is likely to cancel its regulations to minimize the impact on Japanese companies, South Korean semiconductor companies will continue to reduce the percentage of Japanese materials used in production in the future." 

Japan's Toyo Keizai Shimbun said that the Japanese government's regulation has limited impact on South Korea's semiconductor industry, but what is worrying is that South Korea is building its own hydrogen fluoride production system.

A columnist for Japan's Electronic Times also pointed out that while Korean companies will be under pressure from the Japanese government, Japanese companies will also suffer huge losses. The Japanese government is digging its own grave.

Whether it is the fight between Japan and South Korea or the trade war between China and the United States, we can see the importance of supplier diversification. If South Korea really establishes a new semiconductor material supply system, and Japan accounts for a very small proportion or is not included in the system, this will shake Japan's position as the upstream hegemon of the semiconductor industry.