In December 2024, the Fused Silica market witnessed an upward trend in China and India, driven by strong downstream demand from semiconductors, electronics, and foundry sectors. Chinese Fused Silica prices, FOB Shanghai, rose by 0.8%, while Indian Fused Silica CFR JNPT, recorded a sharper 4% increase. These price movements reflect regional market dynamics and broader geopolitical influences. 

Further, China’s semiconductor exports during the first 11 months of 2024 increased by 20.3% year-on-year, according to the General Administration of Customs. This growth highlights the country’s focus on domestic innovation and output despite escalating sanctions and export restrictions from the United States. The rising demand for Fused Silica in semiconductor manufacturing, particularly for chips, has been a key factor driving Chinese market prices upward.

India’s dependence on Chinese imports for semiconductor-grade materials including Fused Silica has played a significant role in its price surge. While the country is making strides in local semiconductor production, it remains reliant on imports to meet immediate demand. The depreciation of the Indian Rupee against the US Dollar and increased freight costs have further amplified the 4% price hike in the Indian market.

This year, India has launched various initiatives to strengthen its local manufacturing and tech ecosystem. Significant investments from global companies and the establishment of new high-tech plants have marked progress. However, these efforts are still in the early stages, leaving India dependent on China for essential materials like Fused Silica to support its semiconductor sector. 

The geopolitical situation has introduced an additional layer of complexity. The US-China chip war has led to significant restructuring in global semiconductor supply chains. While China has focused on bolstering its domestic capabilities, India has positioned itself as a potential alternative manufacturing hub, impacting demand for Fused Silica. 

Moreover, China’s resilience in its semiconductor sector has been evident, with the country leveraging homegrown advancements to counter the effects of sanctions. This robust performance has sustained strong demand for high-purity materials like Fused Silica, keeping its market buoyant despite external challenges. 

Meanwhile, India’s reliance on imports underscores the challenges of transitioning to a self-sufficient semiconductor ecosystem. As global markets continue to evolve, India’s ability to attract investments and scale production will determine its long-term position in the semiconductor supply chain. 

As per ChemAnalyst, Fused Silica prices in China and India are expected to ease at the start of the new year due to seasonal and market-specific factors. In China, the Lunar New Year holiday is likely to slow industrial activity, reducing domestic demand and leading to a temporary price correction. Meanwhile, in India, lower import volumes from China during this period, along with stabilization in freight rates and currency fluctuations, are anticipated to moderate the recent price surge for Fused Silica. These seasonal adjustments might provide short-term relief to the market before demand rebounds in the following months.