As if the rising price of memory and spiralling demand for crypto-mining GPUs wasn’t enough, the cost of silicon wafer is set to increase dramatically over the next few years. It’s time to start paying wallet emptying prices for glorified sand.
SUMCO is a Japanese silicon wafer manufacturer estimated to provide two-thirds of the world’s supply of silicon wafer. This silicon wafer is one of the raw materials used in semiconductor manufacturing, used in everything from CPUs to GPUs and DRAM. SUMCO has confirmed the price of silicon wafer has jumped 20% this year alone, and it’s set to continue rising substantially for the next few years at least.
“We are also planning to increase the price of silicon wafer by 20% in 2018,” said SUMCO CEO Hashimoto Mayuki. “Price of silicon wafer will continue to rise in 2019.”
Interestingly it doesn’t seem as if increasing the price is something SUMCO is being forced to do, rather than an across the board demand for semiconductors means it’s excellently placed to capitalise on this and reap huge profits. It now means the likes of the GPU and memory industries are going to be hit by rising prices of on two fronts simultaneously.
What’s kind of worrying in this scenario is the dominance of SUMCO in this scenario. Silicon is required for just about every form of technology manufacturing in the world, and they hold the keys to two-thirds of the world’s supply. SUMCO says jump and the rest of the world has to say how high. The upside to all this though is that silicon costs currently account for a fairly small proportion of the overall costs of tech manufacturing, but it will still need to be accounted for.
The end result of this price hike is that the price of technology must rise from now through until at least 2019, and likely beyond. The only scenario that could possibly change this scenario is if other silicon wafer producers up their manufacturing to counterbalance the price increases. That’s a tall ask in a short space of time, and we can only hope the knock-on effect isn't too huge for consumers.
Source: etnews via PCGN