TOKYO -- Mitsui Chemicals will spend nearly 10 billion yen ($91.5 million) to ramp up Taiwanese production of a special tape used in semiconductor manufacturing as demand grows from the spread of smartphones and the Internet of Things.
Mitsui Chemicals will update its factory in the city of Kaohsiung to bring new equipment online in 2023. Annual capacity there for the tape, used on silicon wafers to protect against damage or contamination during the back-grinding process, will double to 7.6 million sq. meters.
Mitsui Chemicals also makes the tape in the Japanese city of Nagoya and says it is the world's top producer, commanding a roughly 40% share of the global market.
The Japanese company began churning out the tape in Taiwan in 2020. The chemical maker seeks to bolster production close to major customers so that it can flexibly meet rising demand.
Demand for semiconductors is seen continuing to increase at a rapid clip amid moves to 5G wireless service and electrified vehicles. World Semiconductor Trade Statistics has forecast the market to reach a new record, growing slightly over 8% in 2021.
Other Japanese chip materials companies, including Mitsubishi Chemical and Showa Denko Materials, are setting up new production facilities in Taiwan as well.