The global photoresist market size has grown from 5.55 billion USD in 2010 to 8.7 billion USD in 2020, with a CAGR of around 4.6%. According to Reportlinker data, with the advancement of electronic technologies like automobiles, artificial intelligence, and national defense in the future, the CARG in 2020-2026 will be as high as 5.5%, and by 2026 it will exceed 12 billion USD.
Benefiting from the transfer of the semiconductor, LCD and PCB industries to the eastern countries, the scale of China’s photoresist sales market has increased from 2.69 billion RMB in 2010 to 8.74 billion RMB in 2020, with a CAGR of 12.5%, much higher than the global average growth rate. China accounts for about 14% of the global total photoresist market, which means it is huge space for growth. It is estimated that the scale of China’s photoresist market will reach 15.64 billion RMB by 2026, and the CARG in 2020-2026 will reach 7.2%.
What are the obstacles of high-end photoresist localization in China?
Photoresist technical barriers are mainly reflected in three aspects: formulation technology, quality control technology and raw material technology. Formulation technology is the core of photoresists to realize the function, while quality control technology can ensure the stability of photoresist performance, and raw material technology plays a key role in the quality of photoresists.
- Formulation technology
Photoresist is widely used in the downstream area. Different customers have different photolithography application requirements. Based on various application requirements, there are many kinds of photoresists. These differences are mainly achieved by adjusting the formulation of the photoresist. Therefore, adjusting the formulation of photoresists to meet differentiated application requirements is the core technology of photoresist manufacturers.
- Quality control technology
Since users have high requirements for the stability and consistency of photoresists, it is necessary for photoresists to maintain a high level of photoresist sensitivity and consistency of film thickness. Therefore, photoresist manufacturers not only need to equip complete testing equipment but also need to establish a strict QA system to ensure stable product quality.
- Raw material technology
Photoresist is a complex and precise formula product that has been strictly designed. It is composed of resins, photoinitiators, solvents, additives and other raw materials of different properties, through multiple arrangements and combinations, and undergoes complex and precise processing. Therefore, the quality of raw materials plays a key role in the quality of photoresists.
The certification process is complicated and time-consuming. Customers are not willing to change suppliers.
Photoresist technology has a great impact on the function and stability of electronic components, which causes downstream customers are cautious in choosing suppliers of photoresist special chemicals. They usually adopt the mode of certified procurement to select suppliers.
The certification process includes multiple links such as “trial test, sample certification, pilot test, factory on-site audit, mass production”. The time period required for certification is long. For example, the verification period of LCD photoresists usually needs 1-2 years, and that of a semiconductor photoresist is about 2-3 years.
Due to the high cost of certification and the relatively high risk of replacement, downstream customers attach great importance to establishing long-term and stable cooperative relationships with their qualified suppliers, and are not willing to change the original photoresist supplier.
Lithography machines mainly rely on imports.
The lithography machine is an important equipment for chip manufacturing and high-end photoresist research and development. Due to high technical barriers of lithography machines, China’s high-end lithography machines almost rely on imports.
Currently, the global lithography machine is monopolized by ASML in the Netherlands, NIKON in South Korea, and CANON in South Korea. In 2019, the combined market share of the three companies accounted for more than 90% of the global lithography machine market.
Limited by technology, China’s demand for lithography machines is highly dependent on imports. According to data, China’s total import and export volume lithography machine industry in 2020 was 1.95 billion USD, while the trade deficit reached 1.759 billion USD.
Raw materials barriers
Raw materials are monopolized by foreign companies, and highly dependent on imports.
It can be discovered that the main producers of photoresist raw materials in the world are located in Japan, the United States, China, South Korea, the United Kingdom and the Netherlands. Among them, the largest number of companies are located in Japan, accounting for 49% of the global number of photolithography raw material manufacturers.
Although the number of Chinese enterprises accounts for 29%, its technical level is still far from the international level. The output and scale are small, and its various specifications are limited.
In the field of photoresist upstream raw materials, domestic companies have a presence in each specialty chemical field, but the distribution is extremely uneven and the product coverage is narrow.
What is the following development direction of photoresist?
Photoresist is the core material in the field of semiconductors, LCD and PCB.
In 2020, in the global photoresist market, the semiconductor, LCD and PCB segments are worth 2.04 billion USD, 2.25 billion USD and 2.05 billion USD. It can be discovered that there are the top three application fields. Among them, the proportion of the semiconductor photoresist market in the whole market continues to increase. According to SEMI statistics, the proportion of semiconductor photoresist in the overall photoresist has increased from 21.9% in 2019 to 23.75% in 2021.
Photolithography is one of the three core processes of semiconductor manufacturing, accounting for about 30% of equipment costs. At present, the lithography process is the most critical and complicated step in IC manufacturing. The lithography machine is currently the most expensive semiconductor equipment. The lithography process is also the step that takes much time in manufacturing. It accounts for about 30% of the equipment cost of the wafer production line.
- LCD photoresist
LCD photoresist includes color and black photoresist, touch screen photoresist, TFT-LCD photoresist, etc. In the process of LCD display, photoresist is mainly used to make display pixels, electrodes, barrier ribs, and phosphor dot matrix. For the manufacturing process of LCD displays, in order to produce large-size, high-resolution flat-panel displays, it is usually necessary to use photolithography technology to repeat silk screen printing more than ten times.
- PCB photoresist
PCB photoresist mainly includes dry film, wet film photoresist and photoimaging solder resist ink. The manufacturing process of PCB involves pattern transfer, that is, transferring the designed circuit image to the substrate board. This process needs to use photoresist.
The dry film photoresist is pressed on the copper clad board. And the circuit pattern on the negative (mask plate or negative plate) is copied to the dry film photoresist through exposure and development. Then use the anti-etching performance of the dry film photoresist to etch the copper clad laminate, and form the fine copper lines of the printed circuit board.
PCB photoresist benefits from the continuous improvement of China’s PCB industry. Before 1990, the global PCB market was dominated by Europe, America and Japan, and China mainly relies on imports.
The proportion of the PCB market in mainland China has fluctuated from 50% in 2016 to nearly 55% in 2021, and has become the world’s largest PCB producer. Benefiting from the transfer of downstream industries, China occupies a dominant position in the global PCB photoresist market, with a market share of 93.35% in 2019, and will continue to benefit from the increase in PCB output value in the future.