Samsung and SK Hynix Seek to Push Down Substrate Prices, Early-Year Price Hikes May Be Rolled Back
Alina Collins
Samsung Electronics and SK Hynix are negotiating with upstream substrate makers to pull second-half delivery prices back to where they stood before early-2025 increases. This means the 3%–4% price hike secured at the start of the year could be fully reversed, squeezing substrate makers between still-high input costs and falling selling prices.
Why are prices being pushed back down so soon after rising?
Earlier this year Samsung and SK Hynix raised substrate delivery prices by an average of about 3%–4%, partly acknowledging suppliers' complaints about rising gold and copper costs.
As raw-material prices have since stabilised, the buyers now argue the rationale for the hike no longer holds — and negotiating leverage has shifted to Samsung and SK Hynix.
This means → the price increase substrate makers won at the start of the year was essentially a brief cost-passthrough window, and that window is closing.
When could the cuts take effect, and how big is the impact?
According to KPCA Secretary General An Youngwoo, several substrate makers have already received requests from clients to lower second-half delivery prices.
If the cuts go through, the entire first-quarter price increase would be wiped out — potentially as early as next month.
In plain terms = half a year's price gains could be erased in a single round of negotiations.
Why are substrate makers in an especially tough spot?
Industry insiders warn of a "double squeeze": raw-material costs remain elevated while delivery prices face downward pressure, compressing margins from both ends.
The pain is sharpest for mid-sized substrate makers not covered by raw-material cost-indexing mechanisms — contractual clauses that automatically adjust delivery prices in line with input costs.
This means → these firms can neither pass rising costs on to customers nor resist client-driven price cuts, putting both investment capacity and next-generation R&D at risk.
What has the industry association proposed — and can it help?
KPCA has urged Samsung and SK Hynix to hold off on price cuts and made three specific recommendations: expand the scope of cost-indexing mechanisms, establish a government-industry supply-chain council, and increase policy support for critical mid-sized firms.
KPCA's core argument: the upswing profits of the current semiconductor upcycle should not stay with chipmakers alone but extend to upstream partners such as substrate suppliers.
This reflects a structural bargaining-power imbalance within Korea's semiconductor supply chain — the fact that an industry association had to step in publicly signals that mid-sized firms have almost no leverage in market-based negotiations alone.
Content is for reference only, not financial advice.