Ultra-pure wet chemicals: Cycles

How memory slumps and AI booms swing wet chemical demand

Demand follows wafer starts and the number of cleaning and etch steps, so volumes dip in memory downturns (2019, 2023) and rise with new fabs. Prices are contract-based and stable; the big swings are in base-chemical costs (sulphuric acid in 2022 and 2026, HF with fluorspar) and in supply shocks such as Japan's 2019 HF curbs on Korea. Listed suppliers' electronics segments show the cycle better than public prices.

Margin cycles show in segment results of Entegris, Merck, Soulbrain and Kanto rather than in a public spread.

Booms and busts

1. 2019

   Japan tightened exports of high-purity HF, photoresist and fluorinated polyimide to Korea. Korean fabs qualified Soulbrain and other suppliers within months (indicative).

   not published

2. 2022-2023

   Memory downturn cut wafer starts in 2023 after record 2022 demand; base sulphuric acid spiked in 2022 (sulphuric acid tile).

   not published for electronic grades

3. 2025-2026

   AI chip demand and new fabs lifted demand; base acid prices rose again in 2026 as China halted acid exports (sulphuric acid tile).

   market $4.58 billion (2025) to $5.00 billion (2026) (Straits Research)

What drives the cycle

• Wafer starts and step counts. 3D NAND and advanced logic add cleans and etches per wafer.
• Fab localisation. New fabs in the US, Japan, Europe and India need local suppliers.
• Base chemical prices. Sulphuric acid and HF price shocks pass through over time.
• Export controls. Japan 2019 and US-China controls reshape supplier choice.

Metrics to track