Image: Intel

IDC has a sunny forecast to share for enthusiasts who have grown tired of hearing about the chip shortage in tech headlines.

According to a new report by the analyst firm, the semiconductor market is growing at such a positive rate that normalization should be reached by the middle of 2022. That’s excellent news in itself, but IDC goes on to suggest that the expansions will be so effective that the industry may end up with an oversupply of chips in 2023.

IDC expects the semiconductor market to grow by 17.3 percent in 2021 versus 10.8% in 2020. According to IDC, the industry will see normalization and balance by the middle of 2022, with a potential for overcapacity in 2023 as larger scale capacity expansions begin to come online towards the end of 2022.

In terms of the more immediate future, IDC clarified that dedicated foundries are currently fully allocated for the rest of year, with capacity utilization at nearly 100 percent. Semiconductor wafer prices are also expected to continue increasing for the rest of 2021 due to material costs and other reasons.

“The semiconductor content story is intact and not only does it benefit the semiconductor companies, but the unit volume growth in many of the markets that they serve will also continue to drive very good growth for the semiconductor market,” says Mario Morales, Group Vice President, Enabling Technologies and Semiconductors at IDC.

Source: IDC (via The Register)

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7 Comments

  1. Nah, we’ll have an earthquake, or tsunami, or power outage, or thermonuclear war, or something to keep the prices high.

  2. [QUOTE=”Brian_B, post: 41571, member: 96″]
    Nah, we’ll have an earthquake, or tsunami, or power outage, or thermonuclear war, or something to keep the prices high.
    [/QUOTE]

    Next will be the chip wars where nations will battle for the chip manufacturing they need to keep the population sedate and heads down in their phones… Oh look a notification.

  3. It won’t. Even if it is, prices will remain. People talk about how capitalism is supposed to work, truth is many aspects of capitalism are actually not allowed to work properly.

  4. [QUOTE=”Uvilla, post: 41595, member: 397″]
    It won’t. Even if it is, prices will remain. People talk about capitalism is supposed to work, truth is many aspects of capitalism are actually not allowed to work properly.
    [/QUOTE]

    Yea we won’t see prices come back down to pre covid levels unless we have an actual economic collapse on an international level.

  5. [QUOTE=”Grimlakin, post: 41597, member: 215″]
    Yea we won’t see prices come back down to pre covid levels unless we have an actual economic collapse on an international level.
    [/QUOTE]
    promises, promises 😎

  6. [QUOTE=”Grimlakin, post: 41597, member: 215″]
    Yea we won’t see prices come back down to pre covid levels unless we have an actual economic collapse on an international level.
    [/QUOTE]
    Hopefully I have cash set aside for that buying opportunity.

  7. I don’t believe it.

    As I recall TSMC’s and Samsung’s first new plants aren’t supposed to come online until 2024, and even when that happens it is unclear whether or not the extreme deamand in the marketplace will just immediately consume all capacity as soon as it is available.

    Unless we have a major financial crisis or the collapse of cryptocurrencies I just don’t see us ever going back to normal again.

    Chip manufacturing on modern small nodes is just too complex, with many simply giving up or having production problems and the demand just continues to go up as more and more devices use chips and crypto miners buy mining cards in bulk orders of the hundreds of thousands of units

    I bet this press release has an agenda, to try to influence markets so someone can make a strategic acquisition.

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