Monday, February 6th 2023
Silicon Wafer Pricing Falling for the First Time in Three Years
Semiconductors are largely made using silicon, even though there are other types of substrates that can be used as well, such as gallium nitride or silicon carbide. However, most semiconductors today are made using silicon wafers, which in turn means that silicon wafers are a key material in the semiconductor industry. Over the past three years, the cost of silicon wafers have increased in pricing, due to higher demand, as there has been a higher demand for semiconductors. However, as there are a limited number of suppliers of silicon wafers, especially at the larger 12-inch size, the increased cost in materials has had an impact on the cost of the final semiconductors.
Reports out of Taiwan are suggesting that the price of 12-, 8- and 6-inch wafers are all starting to see a decline in price. We're talking single digit percentages here and it should be noted that these are spot prices, not contract prices, which are negotiated between the parties a long time before delivery. That said, the fact that the spot prices are point downwards also means that companies with not so great contract pricing are starting to want to renegotiate their contract pricing, as even a small saving here can lead to a bigger saving further down the line. Many IC manufacturers have also asked to pause their contract orders, as the utilisation rate of many foundry nodes are going down, which means the foundries aren't in need of as many wafers as they have ordered. Hopefully this will all lead to lower prices across the board when it comes to semiconductors this year, but it's too early to draw any real conclusions. It's also possible that the end customers won't see any direct benefits from lower costs to the manufacturers.
Sources:
UDN, via @dnystedt (on Twitter)
Reports out of Taiwan are suggesting that the price of 12-, 8- and 6-inch wafers are all starting to see a decline in price. We're talking single digit percentages here and it should be noted that these are spot prices, not contract prices, which are negotiated between the parties a long time before delivery. That said, the fact that the spot prices are point downwards also means that companies with not so great contract pricing are starting to want to renegotiate their contract pricing, as even a small saving here can lead to a bigger saving further down the line. Many IC manufacturers have also asked to pause their contract orders, as the utilisation rate of many foundry nodes are going down, which means the foundries aren't in need of as many wafers as they have ordered. Hopefully this will all lead to lower prices across the board when it comes to semiconductors this year, but it's too early to draw any real conclusions. It's also possible that the end customers won't see any direct benefits from lower costs to the manufacturers.
34 Comments on Silicon Wafer Pricing Falling for the First Time in Three Years
IIRC, 3nm requires huge amounts of ultra-pure water and energy to create. They're made from the same wafers as any other process, but are a heck of a lot more expensive.
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Wafer costs are a bigger deal to the cheaper processes: think 40nm, 90nm, and above. These are used in car parts, microcontrollers, and other such "lower-tech" computers.
;)
Do you want a basic industrial microcontroller? Sure! Only a few months before our next batch comes in. We will put you on the list for the fourth shipment after that.
Went to buy some ECM (aka industrial PWM) fans not long ago and got quoted an 18 month lead time. These are the kind of thing that the manufacturer usually ships the next day.
Automotive is another key part. There are still thousands upon thousands of cars, otherwise complete and ready, waiting on automotive chips.
The lower prices are an indicator of increased supply - the exact thing we need to hear.
Companies, MSM, etc. THINKS their bosses are shareholders, OEMs cherry-picked free-samples issued to the MSM, etc. but what's interesting, though... WISE shareholders knows that their bosses are... CONSUMERS.
3nm requires more equipment, more expensive equipment, more steps (ie: more labor), more electricity, and ultrapure water (rather than "just" a cleanroom environment).
All of these things cost money. There's a reason why cars are made out of 40nm parts and chips, because these older nodes are far more cost-efficient.
OT it's a wafer not a chip it can be used in 14 Nm or 4Nm and it's not the largest cost of chip manufacturing so won't affect the cost we pay much.
Since it's the process costs that are doubling over time, EUV ain't easy.
TSMC 7nm gave you 91 million-transistors per mm^2. While 5nm gave you 171 million transistors per mm^2 (and each of those 5nm transistors use less electricity than each 7nm transistor).
I don't know how far 3nm improves things, but traditionally its a x2 between full nodes. So we're looking at around 340 million transistors per mm^2 of area on the most recent processes.
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The reason why car companies (and other companies) use 40nm or older chips, is because the your tire pressure sensor microcontroller (radio + ADC + logic, its a very small computer) doesn't need to shrink. The vast majority of "computers" you use (Radio interface, car starter, keyfob, tire pressure sensor, antilock brakes, thermostat, toaster oven timer, etc. etc.) are of this class of microcontrollers. They don't shrink, they stay the same for 20+ years at a time. Heck, 40nm is rather luxurious to these, a lot of them are still 180nm or older.
The computers you use as a professional, pro-sumer, or enthusiast do new things. Raytracing requires more transistors to compute where all the light is going. Artificial intelligence requires new circuits (tensor cores) that speed up computations. Spending more transistors to double your core size, or offer 2x, 3x, 4x the cache of older systems is universally beneficial to all video games and applications.
IIRC: Google and other datacenters use megawatts of power. Getting 1.5x more performance inside the same electrical usage is well worth the money.
On the other end of things: cell phones. Getting more performance out of the same battery life is also huge, and can only be accomplished with shrinking nodes.