China exported integrated circuits valued at $177.28 billion during the first half of 2026, a 96% increase compared to the previous year, according to data from the General Administration of Customs reported by South China Morning Post. The figure reinforces the country’s significant role in global semiconductor trade, though it does not mean that its physical production has doubled or that Beijing has caught up with the United States or Taiwan in advanced processors.
Key facts about China’s chip exports in 20 seconds
- China exported 179.44 billion integrated circuits in the first half.
- The declared value reached $177.28 billion.
- Year-over-year growth by value was over 96%.
- The number of units increased much less than the revenue.
- The average price per unit was around $0.99.
- The rise in DRAM and NAND explains a significant part of the increase.
- The data includes memories, microcontrollers, power chips, and mature components.
- It may also include packaged or tested semiconductors in China for re-exportation.
- This does not mean China exported advanced AI processors worth that amount.
- The growth confirms increased industrial and commercial capacity in China’s supply chain.
The difference between value and volume requires caution. In June, China’s semiconductor exports increased by 122% year-over-year in dollar terms, while the number of units fell for the first time in over two years. Economists attribute much of this divergence to rising chip prices, especially memory, rather than to an equivalent jump in physical production.
Memory drives the high value of diverse exports
Dividing the $177.28 billion by the 179.44 billion exported circuits yields an average value close to $0.99 per unit. While this calculation illustrates the scale of the operation, it says little about the specific technology crossing the border.
The customs category for integrated circuits encompasses very different products. It includes DRAM and NAND memories, microcontrollers, power management chips, analog components, and semiconductors used in automobiles, appliances, telecommunications equipment, and industrial machinery. A circuit worth a few cents and a processor costing hundreds of dollars can fall under the same classification.
Therefore, this data does not mean China has exported 179.44 billion AI accelerators. Most of the components are produced in large volumes, many on mature processes that do not require the most advanced tools available in Taiwan, South Korea, or the US.
Memory market dynamics provide a more direct explanation for the increase. The expansion of data centers has boosted demand for HBM, conventional DRAM, and NAND storage. Samsung, SK Hynix, and Micron have allocated more resources to high-end AI server products amid a constrained supply in other segments.
This has caused memory prices to rise sharply. Chinese manufacturer CXMT acknowledged that global demand for DRAM exceeded supply from the second half of 2025. The company quadrupled its year-over-year revenue in Q1 2026 and returned to profit despite rising average selling prices.
This cycle benefits CXMT in DRAM and YMTC in NAND flash memory. Both companies sell products in segments where international prices have risen most. Even if they export similar quantities of chips, each unit might now be declared at a significantly higher value.
Monthly data supports this interpretation. In June alone, China exported $32 billion worth of integrated circuits, during a month in which total exports increased 27%. However, analysts point out that the rise in semiconductor prices played a bigger role than physical volume in the growth observed.
AI influences exports, but indirectly and in a broader sense than the headline suggests. Servers require accelerators, but also large amounts of memory, controllers, power supplies, network interfaces, and storage systems. The pressure on these components extends to PCs, mobile devices, and industrial products.
The General Administration of Customs estimated that total trade in electronic components, computer parts, and other computing equipment reached 5.1 trillion yuan (about $760 billion) in the first half, nearly 57% more than the previous year. This category includes imports and exports and is much broader than integrated circuits, illustrating how AI investment is permeating China’s electronics supply chain.
Chinese exports don’t always mean chips made in China
Customs figures record goods crossing borders, not just the value added by domestic companies. This is particularly important in the semiconductor industry, where supply chains are spread across multiple countries.
A chip can be designed in the US, manufactured in Taiwan or South Korea, then packaged and tested in a Chinese plant before being shipped elsewhere. Customs records this as an export from China, even if the original wafer was neither designed nor fabricated domestically.
China hosts a large OSAT industry specializing in assembly, packaging, and testing. Companies like JCET, Tongfu Microelectronics, and Huatian Technology participate in this final phase, increasingly valuable as processors incorporate multiple chips into a single package.
There’s also processed trade: imported components are integrated into modules, boards, servers, or other systems before being re-exported. The gross value of these operations appears in trade data but cannot be directly used to assess how much silicon is owned by Chinese IP.
This does not invalidate the growth. Packaging, testing, and integration require factories, technical expertise, and supply networks. However, it does not automatically translate the $177.28 billion into self-sufficiency.
Domestic manufacturing is indeed increasing. China produced 484.3 billion integrated circuits in 2025, according to industry figures. The expansion of mature process fabs is enabling greater supply for automotive, consumer electronics, energy, and industrial machinery markets.
CXMT became the world’s fourth-largest DRAM maker with an estimated 7.7% market share in 2025. The company is preparing an IPO to finance process upgrades and capacity expansion, but still lags behind Samsung, SK Hynix, and Micron in density, wafer performance, and HBM memory.
SMIC and Hua Hong have also expanded their manufacturing of mature processes. These do not enable the production of Nvidia’s most advanced accelerators but are critical for automotive, industrial, and power applications. Their global demand remains strong, offering China a less dependency-reliant growth avenue outside cutting-edge node race.
A record trade volume that doesn’t close the technological gap
Beijing presents these exports as evidence of industrial progress. Vice Minister Wang Jun attributed growth to Chinese products’ ability to meet global demand, especially in AI-related equipment.
This is partly true. China exports more chips, has more factories, and more design companies. Its domestic supply chain offers a broader range of components than a few years ago, especially in memory and mature processes.
However, this doesn’t mean China has closed the gap in advanced lithography, GPU design, electronic automation software, or latest-generation HBM manufacturing. Export controls still restrict access to EUV equipment, some tools, materials, and US software.
China continues to import large quantities of semiconductors, with imports from South Korea rising 85% in June and those from Taiwan increasing by 41.1%, largely driven by rising chip prices. The simultaneous increase in imports and exports reflects integration into the global supply chain, not a full replacement of foreign suppliers.
The record may also influence international prices. If CXMT, YMTC, and Chinese foundries keep expanding, increased supply could pressure memory and mature semiconductor segments. This competition might squeeze margins of international manufacturers when the current cycle of scarcity moderates.
In the short term, the effect is opposite. High prices raise the value of Chinese exports and boost earnings for domestic producers. In June, chip revenue increased even as the volume shipped decreased.
Analysis of the second half of 2026 will better clarify both factors. Continued value growth with stable volume indicates prices primarily drive the record. Growth in both units and domestic manufacturing share signals deeper industrial progress.
China has not doubled its technological capacity in six months nor replaced global chip leaders. It has achieved something less spectacular but financially significant: selling a huge volume of chips at favorable memory prices and leveraging an industrial network capable of manufacturing, packaging, and integrating components worldwide.
Frequently Asked Questions
Did China double its chip exports?
No. The nearly 96% increase relates to dollar value. The actual number of units grew much less and even declined in June year-over-year.
Do the $177.28 billion represent advanced Chinese chips?
Not necessarily. This category includes memories, microcontrollers, mature components, and foreign chips processed or packaged in China before re-export.
Why have prices increased so much?
The AI infrastructure demand has absorbed HBM, DRAM, and NAND. Tight supply and capacity shifts toward higher-margin products have pushed up prices.
Does this record mean China is now self-sufficient in semiconductors?
No. Production has expanded, but China still depends on foreign machinery, advanced chips, design tools, and imports of significant memory and components.
via: scmp
