China's Chip Material Makers Accelerate Expansion, Competing for $73 Billion Market
Taylor Wilson
The global chip-materials market hits $73.2 billion in 2025, with mainland China growing at 13% — nearly double the world average. Multiple Chinese firms are now challenging Japan's grip on high-end materials, pushing the supply-chain contest upstream from equipment into chemistry.
How big is this market, and how fast is China gaining?
The global chip-materials market reaches $73.2 billion in 2025, up 7% year on year.
Mainland China grows at 13%, lifting its share to $15.6 billion — roughly one-fifth of the global total.
This means → China is not just consuming more materials; its share of the pie is actively expanding.
Who is encroaching on Japan's turf?
Guangyuan New Materials has begun supplying T-glass — a specialty glass cloth for AI-chip packaging that resists thermal expansion and warping — to Japan's Panasonic and Resonac. The product was previously near-monopolized by Japan's Nittobo.
Guangyuan plans to raise monthly output to 1 million meters and has invested RMB 6.8 billion in a new factory in Henan, with phased production starting last year.
Shengyi Technology, China's largest maker of copper-clad laminate (CCL — the core substrate inside printed circuit boards), is investing roughly RMB 5.2 billion in a new Guangdong plant. Phase one targets 2028, focusing on high-performance products for AI servers and electric vehicles.
Shengyi is reportedly the only Chinese company certified for Nvidia's next-generation chips and a supplier to Huawei. Its Shanghai-listed shares have roughly tripled since early April.
Why are Chinese material makers building factories abroad?
In sputtering targets — materials used to deposit thin metal films onto wafers — the world's largest shipper by volume, Konfoong Materials International, plans to invest RMB 350 million in a Korean plant over the next two years. Its clients include SK Hynix and Samsung Electronics.
Shengyi is also spending RMB 1.4 billion on its first overseas factory in Thailand, targeting customers in Southeast Asia, Europe, and the U.S.
This means → Chinese material firms are not just replacing imports at home; they are planting supply chains on their customers' doorsteps — next to Korea's memory giants and Southeast Asia's manufacturing hubs.
How deep is Japan's moat?
In photoresist — the light-sensitive chemical used to etch circuits onto chips — Japan's Tokyo Ohka Kogyo and JSR together hold about 80% of the market.
In sputtering targets by value, Japan's JX Advanced Metals still ranks first globally. In plain terms = Chinese makers lead on volume shipped, but the most profitable, highest-spec products remain in Japanese hands.
A Shenzhen-based materials executive says Chinese firms lag Japan by at least two to three years, with the gap concentrated in yield rates and production processes.
Can the catch-up deliver on schedule?
Hongguang New Materials Group, China's leading photoresist maker, has filed to list on the Hong Kong Stock Exchange. It develops and produces photoresist raw materials in-house, claiming rapid development capability.
Lai Changsheng, a junior partner at a Chinese market-research firm's Japan unit, notes that Beijing sometimes steers domestic buyers toward homegrown materials through subsidies and directed orders — a public-private mechanism that accelerates the chase.
This reflects a core variable: high-end materials face long certification cycles and slow yield ramps. Investment and policy can narrow the gap, but whether the timeline holds depends on whether these products can truly pass international customers' qualification tests.
Content is for reference only, not financial advice.