SK Hynix is diversifying its supply chain for tetrahydrofuran (THF), a material used in the capacitor process in DRAM production, TheElec has learned.
The South Korean chip giant had asked its key electronic material suppliers whether they want to become a supplier of the material, sources said.
SK Trichem and UP Chemical had expressed their interest to become suppliers of THF, they said.
The material had been exclusively supplied by EGTM, which owns a 45% stake in Eugene Technology.
EGTM had made a considerable profit from being the sole supplier of THF, up to now.
UP Chemical had offered to supply the material at one-tenth of the price EGTM was currently supplying them for, the sources said.
THF was not difficult to make nor is it patented, they said, and EGTM had been the exclusive supplier for three years because it offered to increase the efficiency of SK Hynix’s prior processes.
SK Hynix calls THF surface protection material internally. It is used on the wafer before high-k Zirconium precursors are deposited.
High-k precursors are thinly deposited in atomic layers atop the capacitor in DRAMs.
These capacitors are becoming longer vertically to maintain a high capacity as the circuit width continues to become narrower.
This caused materials that are deposited atop them to gather more at the top and not on the sides. When THF is deposited before the precursor, it prevents the precursors from gathering at the top too fast so that they can be deposited at the top and sides uniformly.
Meanwhile, during SK Hynix’s look for additional suppliers of THF, it had some conflict with EGTM.
SK Hynix had claimed their 3-year exclusive contract starts at the period when they began co-development of the material, while THF had said the contract period should start when it began supplying the material.
SK Hynix ultimately won the argument. EGTM’s profitability is expected to be negatively affected by the additional new suppliers. The chemical firm recorded 12 billion won in revenue in 2019 and 18.5 billion won in 2020. The operating profits for the respective years were 9 billion won and 13.6 billion won. This means its operating margin rate for 2019 and 2020 were 75% and 73%, respectively.