Asahi Kasei's Potential PSPI Halt Threatens Semiconductor Supply Chain

The semiconductor industry is grappling with a potential supply disruption of a critical material used in advanced packaging. The Japanese chemical giant Asahi Kasei, a major producer of polyimide (PSPI), has reportedly notified some of its customers that it may halt supplies of certain products. The affected products are the PIMEL series of photosensitive materials, which are related to PSPI.

The demand for advanced packaging has surged in tandem with the rapid growth in computational power requirements. This increased demand has put significant pressure on the supply of PSPI, a material that is indispensable in all advanced packaging processes and has no known substitutes. Asahi Kasei has cited its inability to meet market demand as the reason for considering a supply halt.

This potential disruption could have far-reaching implications for the global semiconductor industry, particularly for companies involved in advanced packaging technologies. Key players such as Taiwan Semiconductor Manufacturing Company (TSMC), Nanya Technology, and ChipMOS Technologies could be significantly impacted. TSMC's CoWoS (Chip on Wafer on Substrate) packaging technology, which is crucial for developing high-performance AI hardware, could face supply chain challenges.

While Asahi Kasei faces supply risks, market analysts are speculating on which companies might receive priority supply. Given the long-standing and deepening relationship between Asahi Kasei and TSMC, it is possible that TSMC could be prioritized for supply. However, other companies involved in advanced packaging, such as Samsung Electronics and Intel, may face supply chain issues and production delays. This could force companies to adjust their pricing strategies and potentially disrupt the overall production plans for the semiconductor and AI industries.

Despite the potential for priority supply to TSMC, the high demand for AI chips will keep TSMC's CoWoS production capacity under significant pressure. The industry will need to closely monitor the situation and explore alternative solutions to mitigate the impact of this potential supply disruption.