February 14, 2025 /SemiMedia/ — Japanese silicon wafer manufacturer Sumco announced it will cease 200mm wafer production at its Miyazaki plant by the end of 2026. The move is part of the company’s strategy to optimize its product portfolio and improve profitability.

Due to weak demand for smaller wafers, Sumco is restructuring its production of wafers 200mm and below. The company noted that demand for 150mm and smaller wafers has declined, as customers shift to 200mm wafers or reduce production capacity as equipment reaches the end of its life cycle.

To adapt to these market changes, Sumco will convert the Miyazaki plant into a single-crystal ingot production facility, with wafer production being shifted to other Sumco plants in Japan and Indonesia. Employees affected by the transition will be reassigned to the company’s 300mm wafer business.

The silicon wafer market continues to face prolonged demand weakness, largely due to the post-pandemic demand slowdown and structural changes in the semiconductor supply chain caused by U.S.-China trade tensions. Although semiconductor production adjustments continue, with customers still adjusting inventories of 300mm wafers, Sumco expects demand to gradually recover, driven by strong momentum in high-end products such as AI chips and high-bandwidth memory (HBM).

Sumco Chairman Mayuki Hashimoto noted that the 200mm wafer market is facing intense price competition from Chinese suppliers, while growth has stalled due to a slowdown in electric vehicle demand.

Looking ahead, Sumco plans to focus its resources on modernizing equipment at its existing 300mm wafer factories to enhance its capability to produce cutting-edge products for AI applications, in response to accelerating semiconductor technology innovation.