Pace of chip market growth slows in China
Europe’s falling market has stood in contrast to much of the rest of the world over the last two years. However, in December’s averaged chip sales, China’s annual growth fell to be the lowest of all regions, according to numbers gathered by World Semiconductor Trade Statistics and reported by the Semiconductor Industry Association.
In other geographic regions the trend from previous months continued with strong annual growth moderating in the Americas and Europe and Japan accelerating as they come out of their pandemic-induced dips.
Asia-Pacific’s high growth stands in stark contrast to China’s low growth, but as China represents one-third of the global semiconductor market it is the dominant influence on the global market.
The three-month average of worldwide sales of semiconductors in December was US$39.16 billion an increase of 8.3 percent over the equivalent figure in 2019, down 2 percent sequentially.
Regionally, sales increased on a year-to-year basis in all regions: Asia Pacific/All Other (12.7 percent), the Americas (11.1 percent), Japan (7.3 percent), China (4.4 percent) and Europe swung into growth with a 4.7 percent increase.
Three-month average of chip sales by geographic region for December and November 2020. Source: SIA/WSTS.
The three-month average of sales in October, November and December stands as a proxy for the fourth quarter. Fourth-quarter sales were 8.3 percent higher than 4Q19, 3.5 percent more than 3Q20.
Next: Annual picture
On an annual basis, global semiconductor sales were $439.0 billion in 2020, an increase of 6.5 percent compared to the 2019 total of $412.3 billion. The Americas region performed best in 2020 increasing its market by 19.8 percent. China’s market was worth US$151.7 billion in 2020 a more modest increase of 5.0 percent. Annual sales also increased in 2020 in Asia Pacific/All Other (5.3 percent) and Japan (1.0 percent), but decreased in Europe (-6.0 percent).
The two largest market segments in 2020 sales were logic at $117.5 billion, up 10.3 percent, and memory at $117.3 billion, up 10.2 percent. Each sector accounts for just over a quarter of the market. Within the memory category NAND flash stood out having increased by 23.1 percent to $49.5 billion in 2020.
In a statement accompanying the release of the figures John Neuffer, CEO of the SIA, appealed for the US government to provide incentives for domestic chip production.
“While global demand for semiconductors is on the rise, the share of global chip production done in the US has declined from 37 percent in 1990 to 12 percent today, and that disparity will only intensify without US government action to level the global playing field. It’s imperative the federal government fully fund incentives for domestic chip manufacturing and investments in chip research so the US can benefit from growing demand and produce more semiconductors needed to strengthen our economy, national security, and critical infrastructure.”
Monthly data is given by the SIA as a three-month average although the source of the data, the WSTS, tracks actual monthly data. The SIA and other regional semiconductor industry bodies opt to use averaged data because it evens out the actual data that typically shows troughs at the beginnings of quarters and peaks at the ends of quarters.
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