Global Market Trends Report 2H22: Behind changes i

                             Since 2020, the global chip shortage has been worsening, with price rise being the defining trend of the semiconductor industry. Upstream material and equipment manufacturers face short supplies, chipmakers have increased investments from time to time to expand their product lines, and downstream semiconductor companies have made big money.

Entering 2022, especially after the second half of this year, will the chip shortage continue? Can the global semiconductor boom keep soaring?

Not long ago, there was news circulating in the semiconductor circles that TSMC had met with order cancellations from three of its big customers. At the same time, there are continuous voices for lowering chip price in the market, and speculations are rife in the industry that semiconductors will enter a downward cycle.

Overall, the supply shortage of panel drive IC, consumer-grade MCU, memory chip and other products has started to ease, heralding the beginning of a price decline. However, some power semiconductor chips, especially chips in automotive, industrial control, IoT and other fields, are still in short supply.

Looking forward to 2022, the global semiconductor industry will enter a period of more orderly growth. The tight industrial chain may ease, but high-end chip products will remain in high demand.

The global semiconductor market is expected to continue growing in 2022, but at a lower rate than in 2021. Gartner data show that the global semiconductor market size reached US $552.9 billion in 2021, a year-on-year increase of 26%. In 2022, the market will further increase by 9% to hit US $601.4 billion.

The gray columns indicate forecasts for 4Q21, while the blue columns show the updates for 1Q22 (Source: Gartner)

At SMIC’s recent earnings briefing, Co-CEO Zhao Haijun said that after accelerated consumption and inventory accumulation in the first half of the year, the supply and demand trend of the industry has shifted from comprehensive shortage to structural shortage. Currently, consumer electronics, mobile phones and other stock market segments have entered the stage of destocking, starting to make a soft landing. However, high-end IoT, electric vehicles, industry and other incremental market segments have not yet established sufficient inventory.

Arrow 4Q22 Trends Report (Source: Arrow)

From Arrow’s quarterly trends reports, it is also clear that the wind has begun to change direction in the third year of "chip shortage".

Overall, the global semiconductor industry will continue to maintain high prosperity in 2022. Vertically, tight supply still reins in the upstream of the industrial chain; horizontally, affected by demand, downstream chip products have had mix fortunes in terms of supply and price, shifting from overall shortage to structural imbalance.

Market decline on multiple tracks

Memory chips continue to cool down

Arrow’s latest industry trend report has shown stable memory chip delivery dates and prices.

At the same time, procurement personnel may also check the price, inventory, delivery date and other information of the corresponding products at Arrow Electronics Mall  at any time, and use the information as a reference for knowing the market and placing orders, so as to reduce their procurement costs.