Wafer demand: Good to grow in 2011

PHOENIX, USA: The foundries are ramping 32nm/28nm production, but that's only one of the reasons wafer demand is forecast to grow at above average rates this year. MEMS and sensors will help to grow wafer demand at the ≥1000nm technology nodes.

Microcontroller units are expected to grow by just over 10 percent, driving up the need for more silicon. And, although DRAM units are expected to grow by only 4-5 percent, NAND flash units will continue to grow at double-digit rates. All these are top reasons why wafer demand will grow over 10 percent in 2011.

The earthquake in Japan may have put a damper on growth in the second quarter, but Semico believes the lull in automotive and other markets impacted by the quake will be temporary. Although all production in Japan may not be brought back online by the third quarter, most companies have managed their production, foundry and supplier relationships in order to cover customer demand. Worldwide wafer demand will be strong in the 3rd quarter increasing by 10 percent over 2nd quarter.

Of course, as Intel remains on its two-year production/technology cadence, they will already begin 22nm production this year. While Intel introduces their 22nm product line, AMD and others are giving their 32nm/28nm production the red carpet treatment. Although there is still lots of room for productivity improvements at these new nodes, Semico does not expect companies to run into yield issues like those encountered at the 40nm node.