[Chipformation] DuPont, Supporter of Korea's Semiconductor Industry Expansion

American chemical materials company Dupont has decided to invest more than 200 billion KRW by 2028 to expand semiconductor materials and components production plants and research and development (R&D) centers in connection with the plan to establish the world's largest semiconductor cluster in Yongin. The investment will be directed toward expanding facilities such as extreme ultraviolet (EUV) photoresist (photosensitive material), chemical mechanical polishing (CMP) pads, and packaging R&D centers necessary for semiconductor manufacturing. The company also plans to hire more than 100 new employees. This investment commitment was made during President Yoon Suk-yeol's visit to the United States last month to attend the Asia-Pacific Economic Cooperation (APEC) summit.

Dupont is a company that often appears when the United States makes large-scale investments in South Korea. To stably expand the semiconductor industry, it is necessary to diversify the supply chain for semiconductor materials and components, which currently rely heavily on Japanese supply chains. Dupont, which has research facilities and production plants in Hwaseong and Cheonan developing and producing core semiconductor materials, can play that role.

The Korean semiconductor industry felt the need to stabilize the supply chain of EUV photoresist, one of the three major items regulated by Japan during the 2020 export restrictions, and strengthened cooperation with Dupont. At that time, Dupont promised about 32.5 billion KRW in facility investment to build photoresist development and production facilities in Korea. The investment execution and plant expansion for EUV photoresist production have been completed. Currently, the product is in the development and testing phase, and it is expected to move into actual production starting next year.

EUV photoresist is a material used in the process of forming patterns on semiconductor substrates (wafers). It is essential for semiconductor miniaturization. Japan is the largest producer of photoresist in the world. Most domestic semiconductor companies, including Samsung Electronics and SK Hynix, import the majority of their photoresist from Japan.

In the global photoresist market, Japanese companies JSR and Tokyo Ohka Kogyo hold about 28% and 21% respectively, accounting for nearly half of the market, followed by American Dupont with 15%. The 4th and 5th positions are also Japanese companies, Shin-Etsu Chemical (13%) and Fujifilm (10%), making it essentially a Japanese-dominated market except for Dupont. If Dupont expands its EUV photoresist production facilities in Korea and begins full-scale production, it will significantly help reduce dependence on Japan.

The CMP pads produced by Dupont are also used in semiconductor processes. These pads are components needed to chemically and physically polish the wafer surface to make it flat, and demand for CMP pads is rapidly increasing as the semiconductor market grows. Dupont has monopolized the CMP pad market. At one point, more than 90% of CMP pads used by domestic semiconductor companies were Dupont products. However, recently, SK's semiconductor materials affiliate SKC has started producing CMP pads, slightly reducing Dupont's market share compared to the past.

Dupont also has close ties with Korean companies. Dupont's wafer business division was acquired by SK affiliate SK Siltron in 2020. After acquiring Dupont's silicon carbide (SiC) wafer business for power semiconductors, SK Siltron is currently expanding wafer investments. They mainly supply 6-inch SiC wafers and are conducting research and development for 8-inch SiC wafers with the goal of mass production in the second half of next year.

The semiconductor industry expects that as cooperation between Korea, which is equipped with technology and manufacturing facilities and aims to grow the industrial ecosystem, and the United States, which can counterbalance Japan in the materials and components sector, strengthens, Dupont's investment in Korea will rapidly increase in scale. The 200 billion KRW investment promised by Dupont this time is already twice the amount reported last year. The Korean government views this as a demonstration of its commitment, along with the United States, to develop Korea into a core production and R&D hub for Dupont.