The recent news of China's Dinglong New Materials beginning mass production of DUV photoresists marks a pivotal moment in the country's quest for semiconductor independence.
This development is a direct consequence of international technology restrictions. With access to the most advanced EUV lithography equipment blocked by US-led sanctions, China had to innovate. Chinese foundries like SMIC successfully demonstrated that it's possible to produce advanced 7nm chips, like the one in Huawei's Pura 70 smartphone, using older DUV technology through a technique called multi-patterning. This strategic pivot created a massive and sustained demand for high-performance DUV photoresists, specifically ArF and KrF types.
Of course, this shift didn't happen in a vacuum; it was heavily supported by Chinese state policy. First, the government established the massive 'Big Fund III', a $47.5 billion fund aimed at breaking bottlenecks in the domestic supply chain, including materials like photoresists. Second, a crucial new rule mandates that 50% of equipment for new semiconductor fabs must be sourced domestically. This policy effectively creates a protected, guaranteed market for companies like Dinglong, removing much of the commercial risk associated with building large-scale production facilities.
Therefore, Dinglong's move into mass production wasn't a sudden leap but the logical conclusion of a multi-year journey. The company had already secured validation and initial orders from major domestic chipmakers throughout 2024 and 2025, proving its products met quality standards. This recent announcement represents the convergence of a clear technological need, strong policy support, and available capital.
The implications for the global market are significant. The high-end photoresist sector has long been dominated by a handful of Japanese firms. Dinglong's emergence, backed by the full force of a national industrial strategy, introduces a formidable new competitor. The immediate 9.7% drop in the stock price of South Korean competitor Dongjin Semichem following the news shows that the market views this as a credible challenge to the existing supply chain.
- Photoresist: A light-sensitive material used in photolithography to form a patterned coating on a surface. It is essential for creating the intricate circuit patterns on a semiconductor wafer.
- DUV (Deep Ultraviolet): A lithography technology that uses ultraviolet light with wavelengths of 248nm (KrF) or 193nm (ArF). It is a mature technology that can be extended to produce advanced chips through multi-patterning techniques.
- EUV (Extreme Ultraviolet): The most advanced lithography technology, using a much shorter wavelength of 13.5nm light to create finer and more complex chip circuits. Access to EUV equipment is heavily restricted for China.