TrendForce analysts assessed the potential consequences of new US sanctions against China

TrendForce analysts assessed the potential consequences of new US sanctions against China

The day before, the United States Ministry of Commerce announced new restrictions on China ' s semiconductor production; the sanctions now apply not only to logical chips but also to memory chips; the authorization to supply chip production equipment should now be granted not only to Chinese but also to foreign enterprises located in the territory of the PRC; and the policy of supplying chips that could be used for military purposes to China is being tightened.

The American sanctions have affected the logical components produced under 16, 14 nm and more progressive solutions, the 18 nm and less DRAM chips, as well as the NAND 128-layered and more progressive chips, as noted by TrendForce.

A new package of sanctions will affect China's 16 nm and below-based American enterprises, a number of Chinese companies, including HuaHong Group, as well as other China-based foreign companies, all of which will have to be authorized by the US Department of Commerce before supplying manufacturing equipment, so most Chinese production and the TSMC factory in Nanjing will expand production on 28 nm or more, while China is effectively cut off from external support on decisions that are more progressive than 16 nm.

New restrictive measures will extend the sanctions previously imposed, which have deprived the United States companies of NVIDIA and AMD of the ability to supply to the PRC the accelerators needed to operate artificial intelligence systems, which now apply to central processors as well, and may no longer be able to produce sub-sentencing products on Chinese territory. Most of the components of the high-product computing segment now produce TSMC, using technology 5, 7 and in some cases 12 nm. This will have a negative impact on future TSMC contracts, confident TrendForce analysts.

In accordance with the updated standards, equipment capable of producing DRAM chips on technologies up to and including 18 nm is subject to verification. This will significantly limit the development of the DRAM sector in the country, especially by hitting CXMT, which leads this segment in China. In the second quarter it was going to move from technology 19 nm to 17 nm, and much of the equipment was purchased before the sanctions were imposed, but it was insufficient; the joint project of the company with SMIC will also be threatened. The sanctions will affect the C2 plant that the Korean SK Hynix built in Usi, which accounts for about 13% of all DRAM production capacity, and every stage of its upgrading will now have to be institutionalized by Washington. The three world ' s leading producers of the DRAM chips plan to build production capacity in their countries over the next decade and reduce their presence in China.

American sanctions have also affected the equipment used to produce NAND memory on chips up to 128 layers, which, according to TrendForce analysts, will affect China's YMTC's long-term plans to modernize its industries, as well as the development of the Samsung and Solidigm plants in the country.