Japan Semis: Silicon wafers - The last domino finally falling into shortage?

Since our prior update on the silicon wafer industry, we have seen more positive developments. Raw wafer demand growth is accelerating, led by a stronger memory and logic outlook. We raise our global raw wafer demand forecast to a 14% CAGR in 2025-28, vs. 12% previously, driven by higher DRAM and logic fab capacity. Specifically, we see global DRAM wafer demand growth at 16% (driven by fab capacity), NAND at 14% (driven by CBA wafer stacking), and logic demand growth at 12% (driven by leading edge capacity). Excluding China, we now see the raw wafer market entering shortage from late 2027, with widening gap in the subsequent years. Supply-side changes are incrementally positive, as global ex-China supply is only able to grow at around 5% CAGR until new greenfield projects are announced. Neither Shin-Etsu nor Sumco has announced new capacity plans, and the only major greenfield is from GlobalWafers. China's domestic wafer market is tightening, reducing the potential for local suppliers