Global Semiconductor and IC Packaging Materials Market - 2024-2031

Overview

Global Semiconductor and IC Packaging Materials Market reached US$ 43.1 billion in 2023 and is expected to reach US$ 93.7 billion by 2031, growing with a CAGR of 10.2% during the forecast period 2024-2031.

The growth of electronic hardware needs the use of computational power capable of delivering great performance, speed and bandwidth while maintaining low latency and power consumption. Advance packaging technologies are ideally adapted to fulfill these different performance expectations and the advanced heterogeneous integration requirements, thus allowing enterprises to capitalize on the shifting demands of high-speed computing, artificial intelligence and 5G.

Major semiconductor packaging vendors are seeing significant revenue growth due to increased demand for high-performance computing, IoT and 5G devices. Amkor's computing division, consisting of data center, infrastructure, PC/laptop and storage, accounted for 20% of total sales, up from 18% in the second quarter of 2022. Government-implemented initiatives accelerate the shift toward car electrification, driving market demand.

In 2023, North America is expected to be the dominant region with about 35% of the global semiconductor and IC packaging materials market. Growing investments in the region are likely to drive up demand for semiconductor packaging materials. For example, Texas Instruments announced in February 2022 that it will invest billions of dollars in semiconductor chip manufacture in U.S. through 2031. Texas Instruments announced intentions to invest US$ 3.5 billion per year in semiconductor chip manufacturing in U.S. until 2025.

Dynamics

Technological Advancements for High-Performance Semiconductors

The semiconductor sector is expected to increase significantly during the forecast period. semiconductor and IC substrates, bonding wires, die attach materials and ceramic packaging are all essential components of any electronic device. The materials aid in the development of high-performance integrated circuits that are faster, more reliable and require less power.

Rapid technological breakthroughs in semiconductors boost market demand. In December 2021, the Indian government authorized a US$ 10 billion incentive plan to strengthen the semiconductor industry following the coronavirus's devastating consequences. The factors would encourage the usage of semiconductor and IC packaging materials, which would boost market growth.

Rising Demand for Consumer Electronics

Consumer electronics are in high demand as a result of growing digitization and technical breakthroughs. Miniaturization of electrical equipment necessitates the incorporation of integrated circuits into multi-chip modules. Semiconductor & IC packaging materials contribute by allowing for a reduced form factor with increased reliability and performance.

Furthermore, leading players' ongoing R&D investments in breakthrough technologies and improved operational efficiency of packaging systems propel the market forward. For example, in May 2021, Intel announced a US$ 3.5 billion investment in its Rio Rancho facility to support Foveros, an advanced 3D packaging and manufacturing technology. The factors will impact the semiconductor and integrated circuit packaging materials market demand.

High Costs

The raw materials high costs and the intricate process of integrated circuit production are important factors that limit market development. High cost of semiconductor and IC packaging materials limits their usage which negatively affects the market. Also, the wafer manufacturing cost is significantly higher because of the complexities of ICs.

A significant initial investment is required in the design, development and implementation of semiconductor packaging units to cater to a wide range of industries like automotive, consumer electronics, healthcare, IT & telecommunications and aerospace & defense. The overall cost gets affected by the packaging of diverse chips and integrated circuits with complicated patterning resulting in limited expansion of the semiconductor and IC packaging materials market.

Segment Analysis

The global semiconductor and IC packaging materials market is segmented based on type, technology, end-user and region.

Rising Consumer Electronics Drives the Segment Growth

Wafer-level packaging is expected to be the dominant segment with over 30% of the market during the forecast period 2024-2031. The increasing need for consumer electronics, the requirement for high-performance computing and the benefits of wafer-level packaging, including as energy efficiency, ultra-thinness and compact form factor, are driving the segment's growth.

In July 2021, JCET Group announced the formal launch of XDFOITM, a unique technology for ultra-high-density wafer-level packaging that will provide cost-effective options with maximum integration, high-density connectivity and excellent durability for a variety of chipsets. Such improvements would accelerate the expansion of the wafer-level packaging segment, increasing market demand.

Geographical Penetration

Rising Demand for High-Performance ICs in Asia-Pacific

Asia-Pacific is the dominant region in the global semiconductor and IC packaging materials market covering more than 35% of the market. The rising semiconductor sector, demand for high-performance integrated circuits and ongoing R&D initiatives by leading manufacturers are driving market expansion in this region. Taiwan Semiconductor Manufacturing Co. revealed in September 2021 that it was working on a new advanced small-outline packaging technology for the development of miniaturized systems.

Japan also has a large presence in the semiconductor and electronics industries, as it is home to some of the most important integrated circuit chip manufacturers. According to WSTS, Japan's semiconductor sector income increased by 14.2% in 2022 and is predicted to rise higher in the next years. The nation's packaging demand is increasing mostly because of the country's tremendous improvements in the semiconductor and integrated chip industries.

Competitive Landscape

The major global players in the market include Intel, Amkor Technology, Deca Technologies, Siemens, Samsung, Advanced Semiconductor Engineering Inc, Taiwan Semiconductor Manufacturing Company, Microchip Technology, Synapse Electronique and FlipChip International LLC.

COVID-19 Impact Analysis

The COVID-19 epidemic compelled manufacturing industries to rethink their traditional production procedures, primarily driving digital change and smart manufacturing practices throughout production lines. In accordance to the Semiconductor Industry Association, global semiconductor sales are estimated to reach US$ 515.1 billion in 2023. Semiconductors are critical components of electrical gadgets and the sector is extremely competitive.

The year-on-year drop rate in 2023 was 10.3%, with a rapid recovery projected in 2024. Notable semiconductor chip manufacturers include Intel and Samsung Electronics, with Intel producing US$ 58.4 billion and Samsung producing US$ 65.6 billion in semiconductor sales in 2022, putting them among the greatest businesses in terms of semiconductor sector revenues.

Russia-Ukraine War Impact

The Russia-Ukraine conflict has the potential to worsen semiconductor supply chain concerns and chip shortages that have plagued the industry. The greatest threat is to the supply of certain raw materials required in semiconductor manufacture, such as neon and palladium. With Ukraine as a major source of rare gases like neon, used in the manufacture of semiconductor fab lasers and Russia as a significant supplier of rare metals like palladium, there are concerns about the load on semiconductor chip supply chains.

Ukrainian enterprises, such as Cryoin, play an important role in the semiconductor supply chain. The companies produce specialty gases such as neon, helium, xenon and krypton, as well as their isotopes. The lack of semiconductors will have a domino effect and businesses such as the automotive sector, electrical appliances, cell phones and more will face an increase in costs and a collapse in production.

By Type

• Organic Substrates
• Bonding Wires
• Leadframes
• Ceramic Packages
• Die Attach Materials
• Thermal Interface Materials
• Solder Balls
• Encapsulation Resins
• Others

By Technology

• Grid Array
• Wafer-level Packaging
• Small-outline Package (SOP)
• Flat no-leads Packages
• Dual In-line Packages
• 3D Packaging
• Others

By End-User

• Consumer Electronics
• Automotive
• Healthcare
• IT & Telecommunication
• Aerospace and Defense
• Others

By Region

• North America
  • U.S.
  • Canada
  • Mexico
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Russia
  • Rest of Europe
• South America
  • Brazil
  • Argentina
  • Rest of South America
• Asia-Pacific
  • China
  • India
  • Japan
  • Australia
  • Rest of Asia-Pacific
• Middle East and Africa

Key Developments

• In June 2021, Samsung revealed an updated collection of chipsets for its next-generation 5G solutions and products, which include Compact Macro, Massive MIMO radios and baseband units, which was commercially available in 2022.
• In February 2021, Siemens Digital Industries Software and Advanced Semiconductor Engineering, Inc. recently revealed their collaboration to analyze complicated integrated circuit package assemblies that interact in a single system.

Why Purchase the Report?

• To visualize the global semiconductor and IC packaging materials market segmentation based on type, technology, end-user and region, as well as understand key commercial assets and players.
• Identify commercial opportunities by analyzing trends and co-development.
• Excel data sheet with numerous data points of semiconductor and IC packaging materials market-level with all segments.
• PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.
• Product mapping available as excel consisting of key products of all the major players.

The global semiconductor and IC packaging materials market report would provide approximately 62 tables, 65 figures and 195 pages.

Target Audience 2024

• Manufacturers/ Buyers
• Industry Investors/Investment Bankers
• Research Professionals
• Emerging Companies