Japan And South Korea's Tug Of War Again Escalated, Photoresist Market Rose

Another upgrade of Japan and South Korea's tug of war saw the A-share photoresist sector rise across the board. Rongda Photosensitive, Jingrui and Jianghuawei have a strong daily limit.


Japan's move in August to remove South Korea from the "white list" of trade facilitation was seen as a form of Japanese trade pressure on South Korea. As a counterattack, South Korea also officially removed Japan from the "white list" of trade on the 18th, and the trade dispute between the two countries has escalated.


Because the Korean semiconductor industry relies heavily on Japan for raw materials such as hydrogen fluoride, there is public opinion that when the existing inventory of Japanese-made hydrogen fluoride is exhausted, it may become a day for the shutdown of Korean semiconductor companies. There are even opinions that Japan has been "hiding" its economic strength and technological innovation, and has already occupied the industrial chain advantage in the technology industry ... In a word, Japan is "in the next big game." Is this true?


In fact, Japan's technology industry developed first, such as semiconductors. Before the 1990s, it not only occupied the upper reaches of the industrial chain, it was also a big player in the entire industrial chain. In 1990, Japanese semiconductor companies accounted for 6 of the top 10 companies in the world, including NEC, Toshiba, Hitachi, Fujitsu, Mitsubishi, and Panasonic. The Japanese semiconductor industry reached its peak.


This means that with very few exceptions, the procedures for Korean companies to export related strategic products to Japan have increased, and the approval time has been extended from the first five days to about 15 days. This policy change involves more than a thousand products. This is another powerful countermeasure by South Korea following the official notification of violations by Japan to the World Trade Organization (WTO) on September 16.


Earlier, Japan began to restrict the export of three key raw materials for the semiconductor industry to South Korea in early July, and then officially removed South Korea from the Japanese "white list" on August 28. At the application level, photoresist is mainly used in the lithography steps of semiconductors, panels, and PCB.


The "white list" of South Korea and Japan "pulling black" with each other will undoubtedly bring opportunities for domestic substitution. With the continuous improvement of technology and the increase in market demand, domestic photoresists are seeking breakthroughs in terms of output and quality.


Whether South Korea seeks domestic production of key materials or finds alternatives, in the long run, the damage to Japan ’s own industry is not small, and Japanese media are already worried about this.


Japan's science and technology industry has decades of accumulation, not "waste of martial arts." A similar phenomenon can be seen in the electronics industry. Many Japanese companies have fallen on terminal products, but still have a large market share in the field of parts and components. However, this is a normal phenomenon of industrial migration and cannot represent Japan's "hidden strength." It is even more difficult to conclude that Japan's economic strength and technological innovation are underestimated.