Semiconductor Industry Expresses Concern Over U.S. Government Intervention to Address Supply Shortages

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SEMI, the international industry association for the semiconductor manufacturing supply chain, has conveyed to the U.S. government that attempts to resolve memory chip shortages by influencing prices or production capacity could exacerbate the historic supply crunch triggered by the AI boom.

SEMI represents more than 3,000 member companies involved in the semiconductor industry, including global memory giants Samsung Electronics, SK Hynix, and Micron, as well as TSMC and Intel.

Bloomberg reported this after obtaining a letter sent by SEMI to U.S. Treasury Secretary Bessent on July 1.

In the letter, SEMI pointed out that while targeted policies can help accelerate the recovery of domestic supply chain resilience, government intervention that distorts decisions on pricing or production capacity risks prolonging the demand slump.

The association added that the current market situation is being addressed through investments in domestic manufacturing and an increase in long-term purchase agreements.

Bloomberg interpreted the letter as evidence of the growing sentiment in Washington that the memory shortage is increasingly becoming a political issue, even though the letter does not explicitly mention Chinese suppliers.

U.S. policymakers are closely monitoring the impact of the memory shortage on consumers, a concern that has been further highlighted by recent decisions from Apple and Microsoft to raise product prices.

Apple has been requesting that the Trump administration allow it to purchase memory for devices sold in China from ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies (YMTC), both of which are on the U.S. Department of Defense blacklist.

SEMI urged the government to develop policies that offset rising costs for smartphones and laptops through buyer tax credits or deductions.

Citing industry data, SEMI stated in the letter that while memory production capacity is expected to grow by approximately 19% annually, the explosive demand for AI infrastructure is outpacing supply, constraining availability across all sectors, from laptops and automobiles to home appliances.

(Photo: Yonhap News)

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