Chemical Mechanical Planarization Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)

Chemical Mechanical Planarization Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)

The global chemical mechanical planarization (CMP) slurry market is valued at USD 1.56 billion in 2023. It is expected to reach USD 2.13 billion in 2028, witnessing a CAGR of 6.43% during the forecast period.

The growing technological advancements in fabrication and semiconductor processes, mainly to enhance the performance of the semiconductor, are expected to boost the market's growth. Increasing investment in semiconductor wafer fabrication materials by manufacturers for product innovation is primarily driving market growth.

Key Highlights

• The growing demand for semiconductors and memory chips in markets, including the Internet of Things (IoT), automotive, and 5G, is expected to drive the demand for CMP slurries during the forecast period. The growing adoption of electric vehicles and autonomous vehicles creates a huge demand for semiconductors and ICs, which is projected to drive the market for CMP slurry.
• Due to the growing demand for power semiconductors with accelerated digitalization and electrification, Infineon Technologies opened a new high-tech chip factory for power electronics on 300 mm thin wafers at Villach, Austria. Such active efforts by key vendors in the semiconductor and memory market are anticipated to boost the demand for CMP slurry in the coming years.
• The market's growth is driven by the commercialization of 5G mobile communications systems, which increases the need for data centers/mobile terminals, and the development of high-performance semiconductors due to technological innovation in fields such as artificial intelligence/autonomous driving. As a result, the CMP players are expected to grow as the semiconductor memories move from 2D to 3D structures, and the complexity of the transistor structures, including finely-pitched semiconductor logic circuits, increases.
• Aluminum oxide is the most adopted slurry material in the market, whereas cerium oxide slurries are witnessing a substantial growth rate owing to their application in silicon wafers. CMP processes for advanced logic and memory devices require more varied, non-metal layer combinations that need highly tunable and dilutable CMP slurries to achieve both technical and economic objectives. Therefore, growing multilayer characteristics are forcing the market vendors to offer multi-material polishing, tunable selectivity, and low defects. However, high investment and R&D costs, along with frequent changes in process, are some of the major factors restraining the market growth.
• As per SEMI, soaring pandemic-inspired demand for chips was estimated to drive an 8% increase in global fab equipment spending in 2020 and a 13% increase in 2021. Of all chip sectors, memory witnessed the largest spending increase in 2020, growing USD 3.7 billion, or 16% year-over-year (Y-o-Y), to USD 26.4 billion. The trend also continued in the post-pandemic era, with global fab equipment spending for front-end facilities estimated to increase approximately 9% year-over-year (Y-O-Y) to reach a new all-time high of USD 99 billion in 2022. The SEMI World Fab Forecast report published in September 2022 showed a global capacity increase approaching 8% in 2022, reaching 7.7%, after a 7.4% growth in 2021. Overall, the increasing demand for semiconductor components is expected to significantly aid the demand for CMP slurries in the coming years.

Chemical Mechanical Planarization (CMP) Market Trends

Memory Segment to Hold Significant Market Share

• The memory chip demand continues to witness notable growth driven by expanding applications across server, mobile, data communication, automotive, and industrial segments. For instance, according to WSTS, revenue from memory component sales was estimated to reach USD 134.41 billion in 2022.
• As chemical mechanical planarization (CMP) is now a widely used manufacturing technique by semiconductor companies for creating memory discs, the increasing use of these components in sectors like IoT, 5G, automotive, and data center, among others, may also fuel demand for CMP slurries during the forecast period.
• The semiconductor industry is witnessing a rapid growth rate, with semiconductors becoming the building blocks of all modern technologies. Technological advancements and innovations in this field are directly impacting all downstream technologies. As a result, the semiconductor memory industry is also witnessing a direct impact from the growing demand for high-performance memory systems across multiple end-user verticals.
• The explosion in data generation has fueled the demand for improved memory and storage types at workplaces across the globe. As traditional memory systems have been struggling to keep up with the increased volume of data, the growing investments in data centers are also driving the demand for memory devices. For instance, according to Cloudscene, in 2022, the United States was the leading country with 2,701 data centers, followed by Germany (487), the United Kingdom (456), and China (443).
• A significant proportion of the total system power is spent on the memory systems, as most of the current systems-on-chips (SOC) area is occupied by memories. Moreover, the processing elements need to be fed with instructions and data from memories, where memory plays a crucial role in the system's performance. Therefore, memory is a crucial part of future embedded systems, and non-volatile memory holds great potential to resolve bandwidth, speed, and size problems. These are expected to become market regulars and occupy a significant market share by the end of the forecast period.

Taiwan Holds Major Share in the Market

• Taiwan is investing in 5G, with its strategy for 5G rollout. Since the semiconductor manufacturing sector mainly drives the initiative, it is expected to keep up with the demands of its IC design customers for different types of digital signal processors for 5G and 5 G's high-frequency radio modem circuits. Thus, this is expected to bring advancements in the market.
• Taiwan-based TSMC, the world's largest contract chipmaker with more than 50% share in the global market, is also significantly creating demand for CMP slurries. The growing advancement in the telecom industry, due to 5G, and in the automotive industry are also fueling the company's product demand, developing the scope for the market vendors.
• In May 2023, Microsoft Taiwan established a 5G Foresight Team with local partners to build a complete 5G ecosystem and drive digital transformation by encouraging firms to capitalize on the opportunities provided by 5G and artificial intelligence in Taiwan.
• Taiwan holds a prominent position in terms of total IC foundry output. It is the global leader with advanced below 10 nm production process, also number one in IC packaging and testing output. Due to these factors, the country observes a significant demand from major IC manufacturers worldwide.
• The region is witnessing an increasing demand for consumer electronics. For instance, according to the Ministry of Economic Affairs of Taiwan, the sales value of portable computers in Taiwan increased from TWD 64.13 billion (~USD 2.05 billion) in 2021 to TWD 79.23 billion (~USD 2.53 billion) in 2022. Such instances augment the growth of the market studied.
• Supportive government regulations, easy availability of raw materials and labor have boosted the growth of the semiconductor manufacturing industry. The expanding semiconductor manufacturing is mainly driving the adoption of CMP slurry in the country.

Chemical Mechanical Planarization (CMP) Industry Overview

The CMP slurry market is witnessing significant competition with a limited number of players catering to the market. The market studied has fluctuated with the growing consolidation, technological advancement, and geopolitical scenarios. In addition, the major semiconductor industry player depends on their affiliates for the CMP slurry process, considering their ability to invest, which results from their revenues. Overall, the intensity of the competitive rivalry in the market studied is growing and expected to grow moderately in the forecast period owing to the growth of the semiconductor and IC chip industry. Entegris Inc., Dupont De Nemours Inc., Fujifilm Corporation, Resonac Holding Corporation, Merck KGaA, etc., are some of the major players in the market.

• May 2023 - The US-based Entegris Inc.'s semiconductor high purity process chemicals (HPPC) business, CMC Materials KMG Corporation (KMG), has been acquired by FUJIFILM Corporation under a definitive agreement. Fujifilm would be able to provide its clients with a wider selection of electronic chemicals due to the acquisition of KMG, including KMG's portfolio of HPPCs, which includes photoresists, photolithography materials, CMP slurry, post-CMP cleaner, and others.
• February 2023 - Resonac Holding Corporation announced plans to apply virtual technology to the development of semiconductor materials. The company would apply VR technology in analyzing the mechanisms of interaction between an inorganic substrate and organic molecules for semiconductor and electronic materials, such as CMP slurries (polishing materials). According to the company, it would be the first time that VR technology has been implemented to develop semiconductor materials in Japan.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support