SEMI: Mainland China may become the world's largest semiconductor equipment market next year

According to the Economic Daily, the Semiconductor Industry Association (SEMI) today released a forecast report stating that the global original equipment manufacturers (OEMs) will see their semiconductor manufacturing equipment sales drop by 18.4% to US$52.7 billion this year. However, Taiwan will take over the world's largest equipment market from South Korea and will become the world's number one with a 21.1% increase. North America will grow by 8.4%, ranking second.

The report pointed out that China will maintain its second place for the second consecutive year, while South Korea will drop to third place due to reduced capital expenditure. Except for Taiwan and North America, the overall expenditure of all regions will show a shrinking trend this year.

SEMI estimates that semiconductor equipment sales will resume growth in 2020, jumping 11.6% to $58.8 billion. The latest forecast also reflects that capital expenditures have been on a downward trend in recent days, and market uncertainty will continue to increase due to political tensions and other factors.

According to the SEMI report, sales of wafer processing equipment are expected to decline by 19.1% to US$42.2 billion in 2019; while other front-end equipment, including wafer fab equipment, wafer manufacturing, and mask and shrink mask equipment, are expected to decline by 4.2% this year to US$2.6 billion; in addition, packaging equipment is expected to decrease by 22.6% to US$3.1 billion; semiconductor testing equipment is also expected to decrease by 16.4% this year to US$4.7 billion.

SEMI said that the equipment market is expected to recover in 2020 due to strong memory-related spending and new factories in mainland China. It is expected that mainland China, Taiwan and South Korea will still be the top three markets next year, and mainland China is likely to take the global championship for the first time.

Meanwhile, SEMI estimates that South Korea will become the second largest market with $11.7 billion, while Taiwan is expected to reach $11.5 billion in equipment sales. If the overall economic situation improves in 2020 and trade tensions are resolved, the industry's sales will have room to rise.