China sees surge in value of semiconductor-manufacturing equipment orders amid latest US export controls, as chip imports post mild recovery

China’s imports of semiconductor-manufacturing equipment totalled US$4.3 billion in October, up from US$2.4 billion in the same period last year

Chip imports from January to November were down 12.1 per cent year on year, but improved from the 13.1 per cent drop in the first 10 months of 2023

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Increased imports of chip-making equipment in mainland China showed that domestic semiconductor companies are stockpiling these tools amid the US government’s latest export controls. Image: Shutterstock

Ann Caoin Shanghai

Published: 6:00pm, 8 Dec 2023

China’s imports of semiconductor-manufacturing equipment, the prime target of the United States government’s updated tech export controls, surged in value by nearly 80 per cent in October from a year earlier, according to the mainland’s latest customs data.

Imports of various chip-making tools – including those used to manufacture silicon wafers, integrated circuits (ICs) and flat-panel displays – totalled US$4.3 billion in October, up from US$2.4 billion in the same period last year, customs data showed.

That increased demand reflects the major effort by Chinese semiconductor companies to stockpile chip-making tools ahead of the latest US tech trade controls, which took effect a month after Washington’s announcement.

The US Bureau of Industry and Security in October added less-advanced lithography equipment, used for making semiconductors on a 45-nanometre node and more mature processes, as well as certain advanced tools for etching and film deposition to a list of restricted items for export to China. This was expected to tighten controls that were enforced a year ago, which aimed to impede China’s development of artificial intelligence chips and other advanced ICs.

China’s semiconductor imports have gradually improved since recording a 26.5 per cent year-on-year decline in the first two months of 2023. Photo: Shutterstock

The latest US export restrictions further limit the range of chip lithography equipment that Netherlands-based ASML Holding can export to mainland China, the company’s third-largest geographic market.