Targets, Metal Markets and Raw Material Supply - CMC Fabs...Targets, Metal Markets and Raw Material Supply ... Most W & WSi target are used in memory Fabs. 4. The market is looking

～Confidential and Proprietary～1

2017/11/3KFMI SP-01-IV-376

Danny, ZHONG Weihua

2nd Nov. 2017

Konfoong Materials International Co., Ltd

Targets, Metal Markets and Raw

Material Supply


2017/11/3KFMI SP-01-IV-376

KFMI was founded in 2005. It manufactures ultra high purity metal materials and sputter

targets which are used for semiconductor industry. It has the largest capacity and most

equipment for sputter targets in China.

It has participated in 12 national key projects including the National 863 Project, National

02 Special project. KFMI products have been qualified and are used by international tier

one IC manufacturers. Its sales increased by 30% annually.

KFMI Profile: a Startup Company in China


2017/11/3KFMI SP-01-IV-376

1. China is rich of the metal raw material such as the Cu, Al, Ti, W etc.

2. China also has rich of heavy equipment for metal industrial.

3. There is lack of connection in the supply chain in China between the raw material and high purity sputtering target.

4. After 12 years, KFMI integrate China raw material suppliers together, with the projects of upstream purification and casting, creating a stable, secured, new and complete high purity sputtering target supply chain based in China.

KFMI Effort – New & Stable China Target Supply Chain


2017/11/3KFMI SP-01-IV-376

Raw Material - Al

1. Source of raw material and Pure Al for targets manufacture is stable

2. China has rich of Al raw material and high purity Al

3. Casting Al ingot products with good quality in China is not yet well supplied.

4. KFMI get most of the high purity ingot from Hydro Alumina

Supply:

Ref: Targets‐CMC‐Assoc‐080817LS

5. Worldwide, high purity ingot supply in common alloy such as Al1%Si, Al0.5%Cu, Al1%Si0.5%Cu is stable due to the big volume overall, however, those specific composition is not well supplied due to the low market volume.


2017/11/3KFMI SP-01-IV-376

Raw Material - Al

1. Most Fab keep on pushing lower cost of Al targets in the past years. However, price of these two years is almost stable which indicate the price reach to the bottom.

2. Alternatively, longlife target design with surface profile, or thicker thickness, is becoming more and more popular especially in these two years.

Market:

KFMI patterned longlifeEndura13 AlCu target

3. There is more and more Specific alloy request such as Al2%Cu, or Al0.5%CuW, which request more dynamic operation for target suppliers.


2017/11/3KFMI SP-01-IV-376

Equipment Ingot

Electron Beam Melting Equipment for high purity of Al and Al alloy is ready and

has the capacity to provide target sample;

Source of Al: China Mainland, Japan

KFMI Casting Raw Material - Al


2017/11/3KFMI SP-01-IV-376

4N5 AlCuW

4N5 AlSi

5N5 Al

5N5 AlCu

High purity Al and Al alloy are ready and has the capacity to provide target sample;

Process is in fine tune and optimizing.

KFMI Casting Raw Material - Al

Unit: ton

10

40

80

140

200

0

40

80

120

160

200

240

2016 2017 2018 2019 2020

KFMI forcase


2017/11/3KFMI SP-01-IV-376

Raw Material - Ti

1. Rich of sponge Ti in China with multiple suppliers;

2. However, the quality of sponge Ti in China varies, only certain supplier fulfill the requirement for semiconductor

3. Rich of low impurity Ti in China

4. KFMI get most of the high purity Ti ingot from Osaka Japan.

5. KFMI is starting to produce the Ti purification and Ti casting.

Supply:



2017/11/3KFMI SP-01-IV-376

1. Increasing demand from the market, mainly from the new Fabs and the capacity expansion in existing Fabs, especially China market is much positive due to multiple new Fabs setting up.

2. Request of material impurity is stick at 4N5 and 5N material, low oxygen level (<100ppm) demand shows increasing interesting in semiconductor.

Market:

3. Cost down pressure exist in most Fabs.

4. New supplier from Japan step into market with lowest price bring some price fluctuation in the market these two years.

Raw Material - Ti


2017/11/3KFMI SP-01-IV-376

The Equipment for Ti

purificationEB furnace for Ti Casting

Temperature

( ～ 800C) ，Vacuum(10-2Pa) ，

O < 100ppm

Fe < 5ppm

Diameter:

200mm

300mm

400mm

500mm

KFMI Raw Material - Ti


2017/11/3KFMI SP-01-IV-376

20 100

150 188

238

375

500

0100200300400500600

2 8 12 15 19 30 40

2014 2015 2016 2017 2018 2019 2020

Tons

KFMI Raw Material - Ti

High purity Ti ingot has been in mass

production in KFMI;

Numbers of customer is ongoing

qualification for KFMI internal Ti material,

including 8” and 12” fabs.


2017/11/3KFMI SP-01-IV-376

Raw Material - Ta

1. Ta material price is quite sensitive to the raw material supply Chain. It is stable at 2016 but it is expected to be increase in 2018.

2. Ningxia is the biggest Ta material supplier in China.

3. KFMI mainly get the Ta material from Ningxia in China and HC.Stark in US.

Supply:



2017/11/3KFMI SP-01-IV-376

Raw Material - Ta

1. Most Fabs using the Ta target with ingot type. However, still some technology that is more sensitive to the Rs uniformity and some old technology are using the powder metallurgy Ta target.

2. Ta is one of the most expensive target in Fabs, cost down focus more on the longlifedesign with thicker type.

3. KFMI is supplying not only the standard type 0.25’ but also longlife 0.5’ and 0.65’ targets.

Market:

Encore Ta target

Encore Ta Coil


2017/11/3KFMI SP-01-IV-376

Raw Material - Cu

1. Cu is rich in China ML for raw material.

2. However, for semiconductor industrial, there are lack of high quality Cu ingot in the market, especially in China supply chain.

3. KFMI is buying the high purity Cu ingot from Japan.

4. To full fill the customer request, KFMI is developing own high purity Cu ingot.

Supply:



2017/11/3KFMI SP-01-IV-376

Raw Material - Cu

1. Most Fabs using 6N high impurity Cu targets, some customer are using 5N impurity Cu targets.

2. CuP anode is another high consumer product in semiconductor with 4N impurity.

3. Technology of Cu target is stable without any changes in years. Some longlife design even monolithic design is used.

4. Special alloy such as CuMg, CuAl is used in some customer side, the supply is unic and the demand is urgent.

Market:


2017/11/3KFMI SP-01-IV-376

KFMI High purity Cu material project is in the early stage of development,

The estimate finish date of casting is in March 2018.

KFMI Cu Casting Furnace


2017/11/3KFMI SP-01-IV-376

Raw Material - W

1. Supply of W is dominant by China, China has plenty of supplier for W powder, with different grade from low and high impurity level.

2. The performance of the W powder, especially the size, impurity varies from different suppliers.

3. However, high purity W (5N and above) is not a big market, it tends to be a seller's market due to the small amount of request.

Supply:



2017/11/3KFMI SP-01-IV-376

Raw Material - W

4000X

1. WTi material is still widely used both in semiconductor and solar Fabs.

2. However, the highest material is the pure W target and WSi targets.

3. Most W & WSi target are used in memory Fabs.

4. The market is looking for 2nd supplier for W target. The only sole supplier leads high price for years.

Market:

5. Main challenge of W Target is the high density request which affect the particle performance.


2017/11/3KFMI SP-01-IV-376

KFMI Production Equipment for Powder Target

Induction Sintering Furnace Hot Press Machine (HP) Cold Isostatic Press (CIP)

Hot Isostatic Press (HIP) 10,000 ton Hydraulic PressLarge Rolling Mill


2017/11/3KFMI SP-01-IV-376

Endura11 WTiEntron φ300 WTi

Plate 443.23x125.73x5.9944t WTi Plate 810.4x203.2x18.05t WTi

Conmag1 WTi

W Grade: 3N~5N, WTi Grade：3N-5N，Content of Ti：5%~50%

Z-1000 WTi

300mm SIP W

KFMI W & W Alloy Targets


2017/11/3KFMI SP-01-IV-376

Prompt technical

visit

Plenty of

reports to

customer

CIP(Continuous

Improvement Project)

Prompt response

Best support for

new product

Separate technical team to work with customer for projects

In 2016, we total send 1,400 technical report, daily send 4 reports.

Any request from customer to be response within 24 hours.

KFMI Effort – Fast/Close Technical Support


2017/11/3KFMI SP-01-IV-376

Our Purpose: to fully support customer request

Our target: 100% on time to support customer with satisfaction

Technical Support

• Technical

communication

• Entertain customers

• Technical workshop

• Composition

• Hardness

• Grain size

• Orientation

• Dimension

• Density

• EBSD

• GDMS

• Erosion

• Lifetime Recommendation

• Technical document support

InvestigationTechnical

Development

• Problem

Investigation on

Customer side, such

as arcing, particle,

RS high etc.

• Develop new

technology together

with customer, such

as long life target

development, blast

improvement

Our Service

Customer Service

KFMI Effort – Fast/Close Technical Support


2017/11/3KFMI SP-01-IV-376

Sputter Target CMP Products Parts

Material Al/Ti/Ta/Cu/Mo/WTi/Ni/W PPS/SUS/Polyurethane Al/Cu/Ti/W/Mo/SUS

Product

Semi.（4”~12”）

LCD（G4.5~G8.5）

Solar

Retainer ring

CMP Pad

Diamond disk

Collimator

Top block

Clamp ring

KFMI Products Category


2017/11/3KFMI SP-01-IV-376

Key Customers


2017/11/3KFMI SP-01-IV-376

KFMI Annual Shipments and Sales

Annual Shipments by Piece

14

22

32

39

51

60

-

10

20

30

40

50

60

70

80

2012 2013 2014 2015 2016 2017

2012 2013 2014 2015 2016 2017

21

32

43

52

74

89

0

10

20

30

40

50

60

70

80

90

100

2012 2013 2014 2015 2016 2017

2012 2013 2014 2015 2016 2017

KFMI Annual Sales in USD


2017/11/3KFMI SP-01-IV-376

The New Business of KFMI

KFMI and Cabot Cooperation Signing Ceremony


2017/11/3KFMI SP-01-IV-376

Site1 Yuyao Headquarter

Site 2 YuyaoHigh Purity Metals

Site 3 Yuyao CMP Products

Site 4 ShanghaiSite 5 Hefei

Bonding ShopSite 6 Malacca Bonding Shop

KFMI Total Six Sites


2017/11/3KFMI SP-01-IV-376

To Be Customer’s Trusted Supplier


2017/11/3

KFMI's Stock Code is 300666, June 15, 2017

KFMI was Successfully Listed on Shenzhen GEM


2017/11/3KFMI SP-01-IV-376

Documents

Targets, Metal Markets and Raw Material Supply - CMC Fabs...Targets, Metal Markets and Raw Material Supply ... Most W & WSi target are used in memory Fabs. 4. The market is looking