Wafer Prices Rising by Up to 40% in 2021: Report

erek

erek

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"The foundry industry operates broadly on silicon fabrication nodes and wafer sizes. This article by Telescope Magazine provides insights into the typical use-cases for each wafer size. Although pertaining strictly to pricing of 8-inch (200 mm) wafers, an impending price-rise across the semiconductor industry can be extrapolated on the basis on significant labor cost increases. TSMC is planning to implement a 20% pay hike for its personnel in 2021."

https://www.techpowerup.com/275153/wafer-prices-rising-by-up-to-40-in-2021-report
 
Not surprising. There are only two manufacturers left with the latest gen technology, TSMC and Samsung, and there is greater and greater demand for their manufacturing.

Supply and Demand is real. Limited supply and high demand will always drive up prices.

This is why I - despite not being a huge Intel fan - hope their get their shit together with their process, otherwise this is only going to get worse.
 
Zarathustra[H] said:
Not surprising. There are only two manufacturers left with the latest gen technology, TSMC and Samsung, and there is greater and greater demand for their manufacturing.

Supply and Demand is real. Limited supply and high demand will always drive up prices.

This is why I - despite not being a huge Intel fan - hope their get their shit together with their process, otherwise this is only going to get worse.
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It has more to do with China’s shutdowns on Rare Earth mining and refining they are still operating around 50% and over the past few months stockpiles have started to dwindle. So it’s been an expected thing for prices to go up dramatically.
 
Zarathustra[H] said:
Heh,

Alternate sources of rare earth minerals can't come online soon enough.
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China still supplies more than 80% of the world's rare earth metals and whenever a competing mine opens up they would tend to flood the market with cheap product from their large stockpiles, which in turn causes the price to plummet which oftentimes bankrupts the competing mine. It's been a repeating process they have been doing since the 70's, they took some good notes from the Diamond guys.
 
Lakados said:
China still supplies more than 80% of the world's rare earth metals and whenever a competing mine opens up they would tend to flood the market with cheap product from their large stockpiles, which in turn causes the price to plummet which oftentimes bankrupts the competing mine. It's been a repeating process they have been doing since the 70's, they took some good notes from the Diamond guys.
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Seeing that it is such a strategically important resource, I wonder if this is one area where government intervention to keep a competing mine operational might make sense.
 
Zarathustra[H] said:
Seeing that it is such a strategically important resource, I wonder if this is one area where government intervention to keep a competing mine operational might make sense.
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Because Capitalism?? Well this may change very soon, the stockpiles are greatly diminished and a large price hike would be a very compelling reason for a number of mining operations in the USA, Canada, Japan, and Russia to open up. But the North American approach to this problem has been to try and "Recycle" as much of the stuff as we can but it mostly turns out that those recycling operations that have been pretty heavily government subsidized are just dumping the stuff overseas.
 
Lakados said:
Because Capitalism?? Well this may change very soon, the stockpiles are greatly diminished and a large price hike would be a very compelling reason for a number of mining operations in the USA, Canada, Japan, and Russia to open up. But the North American approach to this problem has been to try and "Recycle" as much of the stuff as we can but it mostly turns out that those recycling operations that have been pretty heavily government subsidized are just dumping the stuff overseas.
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While Capitalism has been important to the U.S. historically, we have traditionally been willing to make exceptions for strategically important things. I just don't know if this rises to that level or not.
 
We are seeing that Capitolistic Directed Economies are more efficient than Democratic Capitalism. Directed Economies JUST DO IT instead of constantly arguing back and forth about what to do.
 
Mega6 said:
We are seeing that Capitolistic Directed Economies are more efficient than Democratic Capitalism. Directed Economies JUST DO IT instead of constantly arguing back and forth about what to do.
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This is hardly the place for political arguments, but it can certainly be argued that the "just doing it" has been the source of a lot of problems in society over the last 70 years, including declining middle class wages and economic crises.

If 2008 taught us anything it is that the old assumption that the markets are rational is decidedly false.
 
Zarathustra[H] said:
While Capitalism has been important to the U.S. historically, we have traditionally been willing to make exceptions for strategically important things. I just don't know if this rises to that level or not.
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After looking into it, it appears the US Government attempted to do just that back in 2010 when China started a trade dispute with Japan and was limiting rare earth shipments, by 2014 there was so much controversy and bad accounting going on that the people involved stepped down while government regulators stepped in to see what happened, by 2017 they folded the whole idea and basically gave up and the US has known it to be an acute issue because in the latest round of Trade Talks with China they have been holding this fact over them and threatening to slow the US supply of the materials as a bargaining point. So yes it really does meet that level they just haven't found a way to make it economically viable, Rare Earth mining is a messy, ugly business, there would need to be heavy subsidies for purchasing American produced materials and guaranteed that China would go to the mat over them if the US attempted it, it would get very ugly and the US economy can't handle that degree of a trade dispute with China.

https://www.defensenews.com/opinion...erican-rare-earth-mining-and-lessons-learned/
 
There's no chance for capitalism here when China has all the cards. We really do just need at least government sponsored research ways to deal with this. Part of the problem is the environmental toll is something China is willing to bear but hard for everyone else. Everyone else has to add the clean tax when extracting the minerals using the chemicals. (not real tax, but just the cost of extra overhead)
 
Zarathustra[H] said:
This is hardly the place for political arguments, but it can certainly be argued that the "just doing it" has been the source of a lot of problems in society over the last 70 years, including declining middle class wages and economic crises.

If 2008 taught us anything it is that the old assumption that the markets are rational is decidedly false.
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You mis-read. Just doing it as in creating and subsidizing your entire economy. We see shades of this in Airbus. It's full blown in China. A more pure Capitalistic Economy can't compete with billions of dollars in subsidies to a Directed Economy. How do you think Huawei domintation occurred and how Airbus even got off the ground? See Made In China 2025. It appears to be working - for them. Where is the US long term goals and even keeping important things like the wafer production we still have here? I don't know because the US policy does a 180 every 4-8 years and the debate is about other things. Declining middle class wages here have nothing to do with "directed" anything. It's called "globalization". Economic "Crisis" are hardly ever created, that's typically a "Business Cycle".
 
Mega6 said:
You mis-read. Just doing it as in creating and subsidizing your entire economy. We see shades of this in Airbus. It's full blown in China. A more pure Capitalistic Economy can't compete with billions of dollars in subsidies to a Directed Economy. How do you think Huawei domintation occurred and how Airbus even got off the ground? See Made In China 2025. It appears to be working - for them. Where is the US long term goals and even keeping important things like the wafer production we still have here? I don't know because the US policy does a 180 every 4-8 years and the debate is about other things. Declining middle class wages here have nothing to do with "directed" anything. It's called "globalization". Economic "Crisis" are hardly ever created, that's typically a "Business Cycle".
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Ah, my bad.

The way I see it is that it is a tradeoff.

When you have a centrally planned economy and don't have to deal with any opposition, it is amazing the scale of grand things you can accomplish.

Innovation tends to go out the window though. Thats probably the primary advantage the capitalistic model has.

Thousands of entrepreneurs all trying their own thing with some crazy idea they think will work, and leads to new successes. You don't get that with planned economies.

Time will tell how this turns out. The likes of China may not care as much about the losses in innovation if they can just steal that innovation anyway, but if the west becomes better at fighting this, things may turn the other way.

I tend to think that the future will be a middle ground of nuance and grey like it always has been. Rarely do we see completely controlled economies or completely unbridled capitalism. Reality tends to pull both systems towards the middle somewhere.

I hope we become better at limiting theft of innovation, and market manipulations like China has been up to for many years. I think its possible if we (the west) all work together, something we have been terrible at over the last 5 years as nationalist populist groups have risen in popularity.

We really need to learn to work together or get crushed by China together.
 
The real cost of the large govt aided monopolies (chaebol) is paid by the smaller enterprises who get crowded out of the market

This is a trade off. A few large companies are an asset for the country but only a few benefit massively.

Whereas with true competition there is no one big company but many benefit

But still I don't see any way around the fact that China has a monopoly over rare earth minerals which gives them a stranglehold over the chip industry
 
Lakados said:
China still supplies more than 80% of the world's rare earth metals and whenever a competing mine opens up they would tend to flood the market with cheap product from their large stockpiles, which in turn causes the price to plummet which oftentimes bankrupts the competing mine. It's been a repeating process they have been doing since the 70's, they took some good notes from the Diamond guys.
Click to expand...

They do the same in cryptomining.
I calculate it and trade based on it. Its wildly profitable, but the trades take months to plan.
 
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