IC manufacturers facing price increases for CMP slurries

Dr. Robert Castellano, The Information Network, USA.

NEW TRIPOLI, USA: Cerium-oxide based CMP slurry suppliers for shallow trench isolation (STI) on ICs and glass disks for hard disk drives (HDDs) are under increased pressure to raise prices and change formulations because of the Chinese embargo of rare earth oxides, according to our reports CMP Technology: Competition, Products, Markets and The Hard Disk Drive Industry: Market Analysis and Processing Trends.

The market price of cerium oxide has increased to approximately $50 per kilogram in September 2010 from $15 per kg in April 2010 and $9 per kg in September 2009.

China controls more than 90 percent of the rare earths market, and in July cut export quotas for 2H 2010 by 72 percent to shore up prices and ensure domestic supplies of the minerals. The Chinese Government's strict export control policy will result in a very tight supply situation is expected to continue in and after 2011.

While some IC manufacturers extended the use of fumed silica or colloidal silica slurries for STI CMP down to the 90 nm technology node, the high oxide-to-nitride selectivity inherent in ceria-based slurries makes them a requirement for ICs below 90nm. We will see STI slurry prices in the $50 per gallon range in the short term.

Slurry suppliers need to reduce the amount of ceria solids in the slurry to keep prices stabilized, yet maintain the slurry's high performance and selectivities already standard in IC manufacturing.

According to our analysis, Hitachi Chemical was the leading supplier of STI slurry in 2009 for IC manufacturing with a 55 percent share of the $70 million market. The market for ceria-based slurry for HDDs is about a third of the IC market, with Showa Denko and Mitsui the market leaders.