Etching Chemicals Market

Global Etching Chemicals Market Forecast

• Market for etching chemicals worth US$1.6 Bn in 2022 to reach US$2.5 Bn by 2030
• Etching chemicals market revenue poised to see 6.3% growth between 2023 and 2030

Quick Report Digest

1. The main trend expected to drive the market growth for etching chemicals is increased demand for customised ones. Furthermore, customised etching chemicals are in higher need than ever, especially in high-tech sectors like aerospace, healthcare, and automotive.
2. The rapidly growing advanced packaging technologies are another significant trend anticipated to drive etching chemicals growth. The 2.5D and 3D packaging involve stacking multiple semiconductor dies or components vertically to increase performance and functionality in a smaller form factor.
3. Research and development (R&D) on etching chemicals and enhancing existing formulations cost a lot of money. For smaller businesses or start-ups looking to enter the market, the high cost of R&D might be a barrier.
4. The electronic etching chemicals segment dominate the market in 2022. PCBs are essential parts of electrical gadgets, including computers and cell phones. To define the circuit traces and connections, undesired copper is selectively removed from PCB boards using etching chemicals.
5. In 2022, the ferric chloride/cuprous chloride category dominated the industry because higher demand from stainless steel product manufacturing industries.
6. In the market for etching chemicals, Asia Pacific is anticipated to grow at the fastest rate. This is due to the adoption of advanced technologies like 5G, AI, and the Internet of Things (IoT) is accelerating in the Asia Pacific.
7. The North American region will dominate the etching chemicals market throughout the forecast period. Cell phones, tablets, and automobile electronics are widely used throughout North America. One of the market's driving forces is the demand for smaller, more potent electronic components, made possible by etching techniques.

A Look Back and a Look Forward - Comparative Analysis

The production of a wide range of electronic gadgets, including smartphones, tablets, laptops, Internet of Things (IoT) devices, and automotive electronics, is made possible by the semiconductor industry's ongoing expansion. All of these gadgets rely on semiconductor parts that demand exact etching procedures. Semiconductor companies produce smaller, more effective, and higher-performing devices to acquire a competitive edge. The use of etching chemicals is essential for achieving these goals.

The market witnessed staggered growth during the historical period 2018 - 2022. This is due to the development of etching solutions appropriate to particular materials used in semiconductor fabrication, which has been the research focus. For instance, the development of wide-bandgap materials has increased the demand for specialised etching chemicals to treat these materials efficiently.

Etching chemical safety has increased because of research, leading to safer formulas and handling guidelines that safeguard the environment and workers. Research institutions, semiconductor firms, and makers of etching chemicals can work together to develop new etching techniques and materials. These partnerships may create fresh possibilities for product improvement and market growth in the coming years.

Additionally, manufacturers of etching chemicals might increase their global market share through partnerships. Strategic collaborations with local distributors and semiconductor businesses in diverse countries make access to new markets and customers possible. Furthermore, manufacturers of semiconductors and providers of etching chemicals may collaborate to set up rigorous testing and quality control procedures during the next five years.

Key Growth Determinants

• Increasing Demand for Miniaturisation in Electronics

Electronic component producers must create smaller and more compact electronic parts as consumer demands shift towards electronic products that are lighter, smaller, and more portable. To develop precise and intricate designs on a smaller scale, etching chemicals are essential in producing printed circuit boards (PCBs), and microelectronic components.

Performance improvement and miniaturisation frequently go hand in hand. Increased functionality, reduced power consumption, and faster processing rates can all be achieved with smaller electrical components. Chemical etching aids in building the complex connections and pathways needed for these advanced capabilities.

Electronic devices can use their space more effectively when their electronic components are smaller. This is crucial for applications like wearables, smartphones, and tablets because every mm of available space is crucial in these devices. Manufacturers can maximize the utilisation of public areas by using etching chemicals.

• Rising Demand for Semiconductor Devices

Electronics technology is always improving, which fuels the demand for semiconductor devices. Both consumers and industries need more potent, energy-efficient, and feature-rich electronic devices. The need for more complex and smaller semiconductor components is driven by this need, which also operates the need for high-tech etching agents.

A capital-intensive and fiercely competitive industry, semiconductor manufacture. The effectiveness of their production processes is something that manufacturers are constantly looking to enhance. The semiconductor fabrication process can be optimised with the help of etching chemicals, increasing output and lowering costs.

• Growing Adoption of 3D Printing

Rough surfaces or layer lines are common in 3D-printed products. Post-processing procedures must refine the final product. These flaws, smooth surfaces, and improved overall polish of 3D-printed components can all be accomplished by chemical etching. As a result, there is a growing need for etching chemicals for post-processing due to the popularity of 3D printing.

Etching chemicals are used in a masking and selective etching procedure in several 3D printing applications. For instance, a 3D-printed object can be coated with a mask, and etching chemicals are applied to remove certain portions while leaving behind the desired characteristics in creating microfluidic devices or complicated metal components.

Major Growth R&D Costs

A lot of money is needed for the creation of novel etching chemicals as well as formulation improvements. The hefty initial R&D expenses may make it difficult for smaller businesses and startups to enter the market. Because of this, the market may experience less innovation and less competition.

Chemical industry research and development initiatives, including etching chemicals, can include protracted development cycles. Before releasing a new product, businesses must spend money on research, testing, and refining over an extended period. The extra time can slow product introductions and make it harder for companies to react quickly to shifting consumer needs.

• Global Supply Chain Disruptions

Chemicals used in etching are created utilizing various raw materials, many of which can come from different parts of the globe. Shortages or delays may hamper the manufacture of etching chemicals in procuring these crucial components due to supply chain interruptions. If supply chain disruptions result in shortages or delays, customers who depend on a steady supply of etching chemicals may experience difficulties in their production processes.

The electronics and semiconductor industries may be affected by this. Supply chain disruptions can make it challenging for businesses to effectively identify and manage risks because of the uncertainty they cause. Long-term planning and investment decisions may become more difficult due to this uncertainty.

Key Trends and Opportunities to Look at

1. Increasing Demand for Green and Sustainable Solutions

Consumer purchasing behaviour is being influenced by rising environmental and sustainability consciousness. To satisfy this need, numerous businesses, including those producing electronics and semiconductors, are looking for eco-friendly manufacturers, distributors, and even etching environmentally benign chemicals.

The sector is forced to embrace greener practices and chemicals due to strict environmental rules and mandates to eliminate hazardous waste and emissions. These rules, which frequently call for the use of less dangerous and more ecologically friendly etching chemicals, must be followed by businesses.

2. Rising Advanced Packaging Technologies

FOWLP is a cutting-edge packaging method that permits the integration of numerous semiconductor dies into a single package with a lower footprint. The redistribution layers (RDLs) and interconnects this technology requires are made using precise etching procedures. Certain etching chemicals are essential to create the delicate patterns needed for FOWLP.

Multiple semiconductor dies or components are stacked vertically in 2.5D and 3D packaging to improve performance and functionality in a smaller form factor. These packaging technologies need etching chemicals to develop through silicon vias (TSVs) and other intricate structures that permit vertical integration. Chemicals used in etching are essential for precisely sculpting these structures.

3. Growing Demand for Emerging Technologies

Advanced semiconductor devices with lower feature sizes and higher performance are needed for emerging technologies like 5G, AI, and edge computing. These state-of-the-art semiconductor components, such as microprocessors, memory chips, and sensors, require etching chemicals for fabrication.

Smaller, more sensitive, and energy-efficient sensors are essential to expanding the Internet of Things (IoT) and sensor technologies. These sensors are made using etching chemicals, which provides business prospects for chemical producers.

How Does the Regulatory Scenario Shape this Industry?

Over the last three years, various regulatory frameworks and standards have been in place to ensure product quality, environmental compliance, and safety for the Etching Chemicals Market. Regulatory bodies are in charge of regulating the use and manufacturing of etching chemicals. To safeguard the environment and the general public's health, the Environmental Protection Agency (EPA) in the United States is a crucial regulatory body that controls how chemicals are used and disposed of.

The Environmental Protection Agency (EPA) laws affect how etching chemicals are made, used, and disposed of, which promotes the creation of more ecologically friendly formulas. The European Union's Registration, Evaluation, Authorization, and Restriction of Chemicals (REACH) rule is being carried out by the European Chemicals Agency (ECHA).

The REACH mandates that importers and producers register, evaluate the risks of chemicals, such as etching chemicals, and provide safety data sheets. The formulation and management of these substances are influenced by REACH compliance. Regulatory agencies play a crucial role in shaping the etching chemicals market by establishing safety and environmental regulations, encouraging the adoption of green and sustainable solutions, and ensuring that chemicals used in the sector fulfil strict quality and safety requirements.

Fairfield’s Ranking Board

Top Segments

1. Electronic Etching Chemicals Category Dominant

In 2022, the category of electronic etching chemicals dominated the market. The main electronic End-user for etching chemicals is semiconductor fabrication. Intricate patterns, structures, and interconnects must be fabricated using these chemicals on semiconductor wafers to manufacture microchips, integrated circuits, and other semiconductor devices.

Electrical devices like computers and smartphones depend on PCBs for their operation. Using etching chemicals, unwanted copper is carefully removed from PCB boards to define the circuit traces and connections.

Furthermore, the automotive etching chemicals category is anticipated to grow fastest. The production of fine automobile parts like gears, valves, and sensors involves etching chemicals.

Processes like etching enable the highly accurate creation of complicated patterns and shapes. Etching procedures are used in electrical contacts and connectors for vehicle electronics to ensure dependable conductivity and corrosion resistance.

2. Ferric Chloride/Cuprous Chloride Segment Leads

The ferric chloride/cuprous chloride category will lead the global etching chemicals market during the forecast period. These chemicals have been fundamental in the printed circuit board (PCB) manufacturing industry, which serves as the foundation for various electronic devices. Their efficiency and effectiveness in etching copper traces on PCBs provide manufacturers with precise control over the process, ensuring high-quality circuit designs.

The safety and environmental considerations of ferric chloride and cuprous chloride are relatively favourable, aligning with industry trends favouring greener and safer manufacturing practices. Cost-effectiveness is another driving factor, making these chemicals a cost-efficient choice for manufacturers. They are versatile, finding applications beyond PCB manufacturing, and have adapted to meet evolving technological requirements.

As the electronics industry continues to expand and environmental regulations become more stringent, the ferric chloride/cuprous chloride category remains a cornerstone in the etching chemicals market.

Regional Frontrunners

North America at the Forefront

North America is expected to dominate the etching chemicals market during the forecast period. Some of the top semiconductor manufacturers and research institutions are in North America, primarily the United States.

Due to their importance in creating semiconductor devices, etching chemicals are in high demand in the region due to their significant semiconductor industry presence.

Numerous foundries, electronics manufacturing facilities, and semiconductor fabrication facilities are in the US. These facilities need a consistent and dependable supply of top-notch etching agents to maintain output.

Asia Pacific Likely to Witness the Significant Growth in Sales During Forecast Period

Asia Pacific is expected to be the fastest-growing etching chemicals market region. Asia Pacific is known as the center of the global electronics industry. Consumer electronics, smartphones, and automotive electronics are just a few of the many electronic items that the area manufactures. These products all rely on sophisticated etching techniques and chemicals.

Some nations in the region, including Taiwan, South Korea, and Japan, give government support and incentives to grow their semiconductor and electronics businesses. This assistance includes funding research and development and promoting environmentally friendly and sustainable behaviours.

India is placing more and more emphasis on using cutting-edge technologies like IoT, smart manufacturing, and AI. Even though these technologies might not be the ones that directly drive the market for etching chemicals, they do help the electronics sector as a whole flourish, which in turn affects the demand for etching chemicals indirectly.

Fairfield’s Competitive Landscape Analysis

The global market for etching chemicals has several key companies involved and is consolidated. To improve their presence on a global scale, the big companies are introducing new products and enhancing their distribution networks. According to Fairfield Market Research, additional market consolidation is also anticipated in the next years.

Who are the Leaders in Global Etching Chemicals Space?

• DAIKIN INDUSTRIES, Ltd.
• ADEKA CORPORATION
• Mitsubishi Chemical Corporation
• Solvay
• SACHEM, INC.
• ZEON CORPORATION
• Nagase ChemteX Corporation
• Stella Chemical Corporation
• BASF SE
• KANTO KAGAKU
• Lam Research Corporation
• Hitachi High-Tech Corporation
• Fujifilm Holdings Corporation
• Avantor, Inc
• Entegris, Inc.

Significant Company Developments

New Product Launches

• September 2023: Leading specialised material provider Solvay announced it would exhibit at Semicon Taiwan 2023 to showcase its extensive material portfolio for the local and international semiconductor manufacturing sector. Additionally, the business will draw attention to the start-up of activities at its joint venture plant for electronic-grade hydrogen peroxide in Taiwan, Shinsol Advanced Chemicals.
• February 2022: To assist chipmakers in creating gate-all-around (GAA) transistor architectures, Lam Research Corp. has introduced a new line of selective etch solutions that employ ground-breaking wafer fabrication methods and advanced chemistries. Lam's particular etch portfolio, consisting of three new devices called Argos, Prevos, and Selis, offers a significant advantage in developing and producing cutting-edge logic and memory semiconductor systems.
• May 2021: Hylar 5000S and Tecnoflon LX are two non-fluorosurfactant technologies that Solvay, a chemical company based in Belgium that works in the hydrochloric acid sector, has introduced. These technologies make it possible to create goods its clients employ in various applications, such as lithium-ion batteries, smart devices, medical device components, engines, and renewable energy installations.

Distribution Agreements

• February 2022: The epoxy division of Hexion Inc. was purchased by Westlake Chemical Corporation, a US-based producer and supplier of petrochemicals, polymers, and building supplies, for $1.2 billion. With the addition of a top downstream range of coatings and composite products, this acquisition will benefit Westlake by expanding its integrated operation. A chemical company called Hexion Inc. was founded in the US and produces specialty chemicals, related technology, and thermoset resins that work with hydrochloric acid.
• October 2020: An agreement with PVS Chloralkali Inc. aims to transfer railcars located in Ohio, Illinois, and Virginia, as well as other sourcing deals for hydrochloric acid to Univar Solutions. PVS Chloralkali Inc. is a global distributor of value-added services along with ingredient and chemical distributors.

An Expert’s Eye

Demand and Future Growth

As per Fairfield’s Analysis, using digital technologies like automation and data analytics enhances process control and efficiency in the manufacturing and using etching chemicals. Furthermore, chemical etching is essential to creating precise nanostructures and unique nanotechnology development and application devices. However, the etching chemicals market is expected to face considerable challenges because of the high cost of research and development.

Supply Side of the Market

According to our analysis, the entities and variables involved in the production, distribution, and supply of etching chemicals to meet demand from various industries, primarily semiconductor and electronics manufacturing, are included in the supply side of the etching chemicals market. These are the main organisations in charge of making the chemicals used in etching.

Large multinational enterprises and smaller specialty chemical firms specializing in etching solutions are manufacturers. They formulate and produce etching chemicals according to industry standards and customer demands. Chemicals used in etching are made from various basic materials, such as acids, solvents, and additives. Suppliers of raw materials offer the necessary components needed for etching chemical manufacture.

The price and availability of these raw materials can greatly impact the price and supply of etching chemicals. These facilities have specialised machinery and production techniques for creating etching chemicals. To guarantee the consistency and quality of the finished products, these production facilities must follow stringent quality control guidelines.

Global Etching Chemicals Market is Segmented as Below:

By End-use Industry:

• Aerospace
• Electronic
• Medical
• Automotive
• Military & Defense
• Miscellaneous

By Chemical:

• Ferric Chloride/Cuprous Chloride (Majorly used for stainless steel)
• Potassium hydroxide (For Silicone surface)
• Nitric Acid (Copper and Brass)
• Hydrochloric Acid (Stainless steel)
• HNA (Silicone)
• Copper Sulfate (Copper and Brass)
• Miscellaneous

By Geographic Coverage:

• North America 
  • U.S. 
  • Canada 
• Europe 
  • Germany
  • U.K.
  • France
  • Italy
  • Turkey
  • Russia
  • Rest of Europe 
• Asia Pacific 
  • China
  • Japan
  • South Korea
  • India
  • Southeast Asia
  • Rest of Asia Pacific 
• Latin America 
  • Brazil 
  • Mexico 
  • Argentina
  • Rest of Latin America 
• Middle East & Africa  
  • GCC 
  • South Africa
  • Egypt
  • Nigeria
  • Rest of Middle East & Africa