China Semiconductor Photoresist 2026 — A Five-Generation Climb from i-line, KrF, ArF to EUV

Author: Tianxia Gongchang Industrial Research Institute Published: 2026-06-19

Chapter 1　Industry Overview and Photoresist Definition

I. Photolithography: The Core Printing Press of Chip Manufacturing

Semiconductor chip manufacturing is among the most precise industrial activities in human history. On a chip no larger than a thumbnail, billions—even hundreds of billions—of transistors are packed together, each with feature sizes shrunk to just a few nanometers, roughly 1/20,000th the diameter of a human hair. The core process that enables this extreme micro-scale fabrication is called photolithography.

Photolithography, literally "carving patterns with light," can be understood through a simple analogy: the lithography machine is the printing press, the photomask is the printing plate, and the photoresist (光刻胶) coated on the silicon wafer surface is the special light-sensitive "ink" that determines print quality. Light emanates from the exposure machine's source, passes through the circuit patterns pre-designed on the photomask, focuses and demagnifies through precision optics, and projects the pattern onto the photoresist film on the wafer. The exposed photoresist regions undergo chemical changes; after development in developer solution, specific areas of photoresist are removed or retained, creating precise patterns on the wafer surface. These patterns then serve as "protective templates" for the etching step, determining which material regions are removed and which are preserved. This cycle repeats for dozens to over a hundred process steps before a chip is complete.

For an advanced 12-inch (300mm) wafer, the photolithography step may be repeated 30 to 80 times across the full manufacturing flow (with leading-edge nodes exceeding 100 steps). Each step requires a photoresist precisely matched to a specific wavelength and specific process requirements—there is virtually no universal product among the dozens of photoresist varieties in use.

Photoresist's market value within the semiconductor manufacturing materials system is not large (typically 5%-10%), but its strategic importance far exceeds this proportion. Photoresist directly determines: pattern resolution (minimum feature linewidth), wafer yield (resist-induced defects directly affect chips-per-wafer output), process window (dose and focus tolerance), and overlay accuracy (multi-patterning alignment, directly affecting chip electrical performance).

Within the semiconductor materials ecosystem, precisely because photoresist is both a consumable (consumed in every process step) and a high-technology product (requiring deep co-optimization with tools and processes), it has developed an extraordinarily unique commercial ecology: a handful of Japanese companies exercise deep monopoly control, customer qualification cycles are lengthy, and once supplier relationships are established they are extremely difficult to switch. This structural characteristic makes photoresist the "soft chokepoint" material in the entire semiconductor supply chain—hardest to replace, most geographically concentrated in geopolitical risk.

II. The Chemical Nature and Classification of Photoresist

Chemically, photoresist is a specially formulated photoactive polymer material system, precisely compounded from multiple components in an organic solvent medium to form a uniform liquid coating. In use, wafer fabs apply it via spin coating to form a uniform film ranging from tens of nanometers to several micrometers thick (depending on process requirements), after which exposure proceeds.

Positive vs. Negative Photoresist

The most basic classification of photoresist is positive vs. negative:

Positive photoresists: exposed regions undergo chemical "softening"—molecular structure changes, solubility in developer increases dramatically, causing those regions to be washed away by developer, exposing the underlying substrate. The remaining unexposed regions retain the mask pattern. Positive resists dominate mainstream semiconductor processes.

Negative photoresists: exposed regions undergo cross-linking, becoming less soluble in developer ("hardening"), so exposed regions are retained and unexposed regions are dissolved. Negative resists have important applications in thick-film processes (MEMS, bumping, TSV vias) and in certain EUV advanced scenarios (metal oxide resists).

Five-Generation Classification by Exposure Wavelength

Generation	Wavelength	Typical Resolution	Major Applications
g-line	436nm	≥1μm	LED packaging, power devices, solar cells
i-line	365nm	~0.35–1μm	Mature wafers (≥130nm), LCD color filters, MEMS
KrF	248nm	~90–250nm	Memory (DRAM/NAND), logic 130–90nm
ArF Dry	193nm	~65–130nm	Logic 90–65nm, some memory layers
ArF Immersion	193nm (water)	~7–28nm	Leading-edge nodes (7nm–28nm)
EUV	13.5nm	≤3–7nm	Most advanced logic (TSMC N3/N2/N1) and advanced memory

III. The Chemical Evolution of Five Photoresist Generations

The DNQ-Novolac system (g/i-line), built on phenolic (Novolac) resin with diazonaphthoquinone (DNQ) photoactive compound, represents the starting point of commercial photoresist. When exposed, DNQ undergoes photochemical reaction to form indene carboxylic acid, which dissolves readily in alkaline developer, while unexposed regions resist.

The transition to KrF represented a foundational revolution: the chemically amplified resist (CAR) concept, pioneered by IBM researchers Hiroshi Ito and C. Grant Willson in the 1980s, replaced the "one photon, one reaction" paradigm with "one photon → photoacid generator (PAG) → hundreds of catalytic deprotection reactions." The polymer backbone shifted from aromatic (DUV-absorbing) to alicyclic (DUV-transparent) structures, based on poly(hydroxystyrene) (PHOST).

ArF photoresists pushed further: the polymer backbone shifted to fully alicyclic acrylate systems (adamantyl, norbornyl, lactone-functional monomers), enabling high DUV transparency at 193nm. Water immersion (NA up to 1.35) extended ArF to 7nm+ via multi-patterning.

EUV photoresists represent the next frontier: using 13.5nm extreme ultraviolet, three competing chemistries are in play—chemically amplified resists (CAR, adapted from ArF), metal oxide clusters (MOC/MOR, pioneered by Inpria/JSR), and small-molecule resists (SMR). Each faces the fundamental RLS trilemma: improving any one of Resolution, Line-edge Roughness, and Sensitivity degrades the other two.

Chapter 2　Global Market Structure and China's Position

I. Global Photoresist Market Scale

The global photoresist market reached approximately USD 4.5–4.8 billion in 2024, projected to grow to USD 5.5–6.0 billion by 2026 and USD 8–10 billion by 2030, driven by advanced node proliferation and capacity expansion in mature nodes.

By segment: ArF immersion photoresist commands the highest unit price (USD 3,000–5,000/kg) and largest revenue share (~~35%), followed by KrF (~~25%), i-line (~~20%), EUV (rapid growth from small base, ~5% and climbing), and g-line (~~5%). Ancillary chemistry (developers, strippers, solvents, BARC) adds another ~10%.

Global Supplier Concentration: Japanese Supremacy

Five Japanese companies account for over 85% of global photoresist revenue:

Company	Estimated Global Share	Key Strengths
JSR	~25–27%	EUV/ArF/KrF full suite; Inpria MOC acquisition; JIC-nationalized 2024
TOK (Tokyo Ohka Kogyo)	~28–30%	KrF leader; strong ArF portfolio; Samsung/TSMC deep relationships
Shin-Etsu Chemical	~12–15%	Resin + finished resist dual-line; ArF/EUV capabilities
Sumitomo Chemical	~8–10%	KrF/i-line strengths
Fujifilm	~6–8%	KrF/ArF products; display resist

The JSR nationalization stands out as a watershed event: Japan's METI established JIC (Japan Investment Corporation) to acquire JSR for approximately USD 6.3 billion (completed April 2024), removing it from the listed company domain. This was an explicit strategic move to prevent potential hostile acquisition of Japan's crown-jewel photoresist assets by non-allied parties, and signals that Japan views photoresist as a national strategic material—not just a commercial product.

II. China's Market Position

China's domestic photoresist market reached approximately CNY 80.5 billion in 2024 (approximately USD 1.1 billion), up ~25.4% year-over-year. Estimated 2025 figure: ~CNY 97.8 billion. Projected 2026: CNY 115–125 billion.

China's share of global photoresist consumption (~~22–25% by 2026) far exceeds its share of domestic supply (~~4–5% of global production). This gap is the core driver of China's localization imperative.

China's Localization Rate by Generation (2026 Estimates)

Generation	Localization Rate	Key Domestic Suppliers
g/i-line (packaging)	~80%	Beijing Kechuang, Suzhou Ruihong, etc.
i-line (wafer-grade)	~20–30%	Beijing Kechuang, Jingrui
KrF	~15–20%	Beijing Kechuang (Tongcheng), Nanda Optoelectronics
ArF Dry	~3–5%	Nanda Optoelectronics
ArF Immersion	<3%	Nanda Optoelectronics (ramping)
EUV	~0%	Pre-commercial R&D only

Chapter 3　Core Technology

I. The Chemistry of Chemically Amplified Resists (CAR)

The heart of modern KrF, ArF, and (partially) EUV photoresists is the CAR architecture. Three key chemical components define CAR:

1. Polymer Resin (Matrix)

For KrF: Poly(hydroxystyrene) (PHOST) and its derivatives, protected by acid-labile groups (e.g., tert-butyl esters, acetals). For ArF: fully alicyclic acrylate copolymers (e.g., adamantyl methacrylate, norbornyl acrylate, γ-butyrolactone methacrylate) offering high 193nm transparency and mechanical stability. Resin accounts for ~50% of the overall formulation cost.

2. Photoacid Generator (PAG)

PAG is the "trigger" of CAR: upon DUV or EUV photon absorption, it decomposes to generate a strong Brønsted acid (typically a sulfonate, e.g., nonaflate or camphorsulfonate). The PAG concentration, acid strength, and diffusion behavior critically determine imaging performance. Key PAG suppliers are heavily concentrated in Japan's Kansai region (Midori Kagaku, San-Apro, etc.).

3. Quencher (Base Additive)

A small amount of base quencher scavenges stray acids at pattern edges, limiting acid diffusion and sharpening line edge definition. The PAG/quencher ratio is one of the most sensitive formulation knobs.

CAR Working Mechanism:

Exposure: PAG absorbs photons → generates photoacid (H+)
PEB (Post-Exposure Bake): thermally activated acid catalytically cleaves acid-labile protecting groups from resin (deprotection reaction), amplified ~100–1000× per acid molecule
Development: deprotected (positive) regions become alkali-soluble → TMAH developer washes them away, forming the pattern

II. The RLS Trilemma in EUV Photoresists

EUV photoresists face a fundamental trade-off known as the RLS trilemma:

R (Resolution): ability to resolve finer features
L (Line-edge Roughness, LER): sharpness of feature edges; ideally ≤1.5nm (3σ)
S (Sensitivity/Speed): resist sensitivity to EUV dose; commercial targets ≤20 mJ/cm²

Improving any one parameter tends to degrade the other two. The root cause is quantum noise ("shot noise"): at EUV doses commercial fabs use, the number of photons absorbed per feature volume is statistically limited (~20–30 photons per 10nm² area), causing random fluctuation in PAG activation and thus stochastic defects (bridging, missing contacts). Metal oxide cluster (MOC) resists offer potential advantages by absorbing EUV more efficiently per molecule and by incorporating inorganic metal (Sn) that can be detected/verified at sub-nm scale.

III. Multi-Patterning and Its Impact on ArF Photoresists

In the absence of EUV tools, multi-patterning allows ArF immersion lithography to reach 7nm+ nodes:

LELE (Litho-Etch-Litho-Etch): Two separate exposures define alternating features. Requires extreme overlay precision (3σ < 3nm) and matched resist shrinkage between passes.

SAQP (Self-Aligned Quadruple Patterning): Uses spacer deposition around a "mandrel" photoresist pattern to achieve 4× pitch multiplication. The mandrel resist must have excellent etch selectivity, low thermal shrinkage, and tight CD (critical dimension) uniformity—properties subtly different from standard ArF resists.

Chapter 4　Supply Chain

I. Upstream Raw Materials

Polymer Resin: The highest-cost component (~50% of formulation cost), requiring semiconductor-grade purity. Key global suppliers: Maruzen Petrochemical (Japan) for PHOST/ArF resins; DIC Corporation; Sumitomo Bakelite; and domestically, Eight-Hundred-Millions Space-Time (八亿时空, the first Chinese company with ArF resin mass production capability).

PAG (Photoacid Generator): Highly concentrated in Japan (~80% global share). Yako Technology (雅克科技) acquired Belgium's Fujifilm Electronic Materials' PAG business in 2019, bringing it key KrF-grade PAG synthesis capability—the most significant Chinese advance in this sub-segment.

Solvents: PGMEA (propylene glycol methyl ether acetate) and ethyl lactate (EL) as primary carriers. Domestic suppliers (Kelin Micro-Materials, etc.) cover much of the market at the lower purity tiers; ultra-pure electronic-grade solvents (<1ppb metals) still partly import-dependent.

Developer (TMAH): Tetramethylammonium hydroxide (2.38% aqueous) is the near-universal developer for positive CAR. Domestic production covers mainstream needs; ultra-high-purity TMAH for 12-inch advanced nodes partly relies on Japanese suppliers (TOKUYAMA, Mitsubishi Chemical).

II. Midstream: Photoresist Formulation and Manufacturing

The formulation step—blending resin, PAG, quencher, solvent, and additives to specification—requires extreme cleanliness (Class 1 or better cleanroom), ultra-low particle filtration, and tight batch-to-batch consistency (Cpk ≥1.67 on key quality parameters). The "recipe" itself, encoding the precise ratios and processing conditions, is the core trade secret of photoresist companies.

Manufacturing scale matters: JSR and TOK operate facilities with multi-hundred-ton annual capacity per product line; Chinese companies are ramping (Nanda Optoelectronics' 500-ton ArF line is the flagship example).

III. Downstream: Wafer Fab Application and Qualification

The qualification journey from initial sample to approved production supplier is the defining competitive moat of the photoresist industry:

i-line: 3–12 months
KrF: 18–30 months
ArF Immersion: 36–60 months
EUV: 48–72+ months

The qualification process involves: material purity verification (ICP-MS, LPC), spin-coat uniformity testing, process integration trials (CD, LER, overlay, defect density), multi-batch consistency validation (Cpk monitoring across ≥50 batches), and finally qualification as an approved vendor.

Chapter 5　Downstream Markets

I. Semiconductor Wafer Manufacturing (Front-End)

Front-end wafer manufacturing is the largest and most technically demanding photoresist market segment. Key consumption centers in China:

Logic foundries (SMIC, HuaHong, etc.): SMIC's multi-node portfolio (28nm/14nm/7nm attempt) consumes KrF at highest volumes, ArF immersion at critical layers; HuaHong focuses on specialty and power nodes, predominantly i-line/KrF.

DRAM (CXMT / ChangXin Memory): DRAM manufacture requires KrF for peripheral/storage-node layers, ArF immersion for critical cell and contact layers. CXMT's capacity expansion represents one of the largest incremental KrF demand sources in China.

NAND Flash (YMTC / Yangtze Memory): 3D NAND stacking requires both high-aspect-ratio etching (thick resist) and precise CD control at cell layer (ArF immersion). YMTC's X-tacking 232-layer architecture uses ArF immersion for cell active area patterning.

II. Panel Manufacturing (Display)

LCD color filter photoresist (Red/Green/Blue/Black Matrix) and OLED pixel definition layer (PDL) photoresist represent significant volume markets—mostly i-line wavelength, but with increasingly tight CD requirements as panel resolution increases. Chinese panel makers BOE, CSOT, Visionox are global production leaders; the domestic photoresist supply for this segment is relatively higher (40–60%) than for semiconductor wafer manufacturing.

III. Packaging and Advanced Packaging

Traditional flip-chip packaging: g/i-line resists for under-bump metallization, redistribution layer (RDL) definition—mostly mature technology with high domestic supply.

Advanced packaging (HBM, CoWoS, Fan-Out): RDL with sub-10μm linewidth requires KrF or ArF resists; through-silicon via (TSV) formation uses thick negative resist. As AI chip demand drives explosive HBM growth, this segment is becoming one of the fastest-growing photoresist demand sources in China (2024–2026 growth rate >50%).

Chapter 6　Key Players

I. Japanese Incumbents

JSR: The global photoresist leader by technology depth. The 2022 acquisition of Inpria (Oregon, USA) brought MOC (metal oxide cluster) EUV resist technology in-house, making JSR the only company with both CAR and MOC EUV platforms. JIC's 2024 nationalization at ~USD 6.3 billion underscores Japan's strategic posture.

TOK (Tokyo Ohka Kogyo): The volume leader in KrF photoresists (estimated 30–35% global KrF share). Its proprietary TARF series (ArF immersion) is qualified at all major fabs (TSMC, Samsung, SK Hynix). TOK is investing in a new Koriyama plant expansion (2025–2026) to add ArF/EUV/KrF capacity.

Shin-Etsu Chemical: Unique in operating both an ArF resin division and a finished photoresist division, providing tight vertical integration. Its SiARC (silicon-containing BARC/hard mask) business is also globally dominant.

Sumitomo Chemical: Strong in KrF/i-line finished resists; also a key player in OLED/LCD photomaterials. Growing ArF capabilities.

Fujifilm: Successfully transitioned from film photography to electronic chemicals; KrF/ArF photoresist commercially qualified at multiple wafer fabs.

II. U.S. and European Players

Merck KGaA (formerly EMD Performance Materials): Dominant in ancillary lithography chemicals (developers, BARC, ARC, TARC); also produces finished photoresists, particularly for display applications. Growing EUV materials capability.

DuPont Electronic Materials: Primarily ancillary chemicals and specialty polymers for advanced lithography.

Entegris: Focused on materials handling, filtration, and photoresist delivery systems; acquired CMC Materials' filtration business.

III. Chinese Domestic Players

Tongcheng New Materials (603650) / Beijing Kechuang: The leading domestic photoresist company by revenue. Beijing Kechuang (北京科华, wholly owned by Tongcheng) is the historical pioneer of China's photoresist industry (founded 1986), with KrF representing its core technology breakthrough. KrF revenue from Beijing Kechuang accounts for an estimated 40%+ of China's domestic KrF market. Key customers include SMIC and YMTC.

Nanda Optoelectronics (300346): The technology pioneer in domestic ArF photoresist. Its ArF Dry product entered mass production qualification at leading Chinese fabs circa 2023–2024; its ArF immersion photoresist achieved technical breakthrough with samples delivered to key wafer fabs. The new 500-ton annual capacity ArF production line is the most watched capacity expansion event in China's semiconductor materials space in 2026. The company's ArF resin is fully domestically sourced (from Eight-Hundred-Millions partner), a notable supply chain milestone.

Jingrui Electronic Materials (300655): Covers full product breadth from g-line to KrF; ArF still in early qualification stages. Photoresist revenue approximately CNY 200 million in 2024.

Shanghai Xinyang (300236): Strong in KrF chemistry; actively developing ArF. Also covers electronic-grade specialty chemicals (developer, semiconductor cleaning chemicals).

Yako Technology (002409): Primary focus on PAG (photoacid generator) upstream materials rather than finished photoresist; acquired Fujifilm's PAG business in 2019. Plays a strategic role as a KrF/ArF PAG supplier.

Chapter 7　Domestic Substitution by Generation and Tianxia Gongchang Database Insights

I. The "Ladder" Model: China's Five-Generation Localization Matrix

From the industrial perspective of Tianxia Gongchang Industrial Research Institute, China's photoresist localization journey follows a clear "ladder" structure: g/i-line form the foundation, KrF is the current breakthrough battleground, ArF immersion is the next strategic high ground, and EUV remains a distant but necessary long-term goal. Each rung up demands substantially higher technical maturity, longer qualification cycles, and greater raw material supply chain independence.

II. Generation-by-Generation Localization Status

g-line Localization (~80%): Substantially complete for packaging applications. Beijing Kechuang, Suzhou Ruihong, and peers supply the LED, power device, and MEMS markets with domestically produced g-line resists. Unit pricing is low (hundreds of CNY/kg) and competitive dynamics are mature.

i-line (20–30% wafer-grade): The gap between packaging-grade (high localization) and wafer-fab-grade (lower localization) reflects the quality differential. Wafer fabs demand tighter CD uniformity, fewer defects, and higher consistency than packaging applications. Domestic players are closing this gap but wafer-fab-grade i-line still sees significant Shin-Etsu and Sumitomo share.

KrF (~15–20%): The "breakthrough zone." Beijing Kechuang's KPLUS series is qualified and in production use at SMIC, YMTC, and HuaHong. The qualification data (99.7% lot-to-lot acceptance rate, CD uniformity ≤2.1nm 3σ) represents a genuine milestone. The domestic supply share is increasing at roughly 3–5 percentage points annually; reaching 30–35% by 2028 is a widely shared industry expectation.

ArF Immersion (<3%): The new frontier. Nanda Optoelectronics' 2023–2025 technical breakthrough makes China one of only five countries with ArF immersion resist development capability. The 500-ton new production line, if it ramps as planned in 2026–2027, could push domestic ArF supply to 5–8% by 2028. Qualification at CXMT and YMTC is a priority—the process integration validation (36–60 months in normal circumstances) is being accelerated due to geopolitical pressure.

EUV (~0%): China currently has no EUV lithography machines and therefore no path to full EUV photoresist qualification in a production environment. R&D work at Nanda Optoelectronics, Shanghai Xinyang, and academic institutions (Peking University) is yielding early synthesis results, but commercial production is 7–10 years away at minimum. The national standards body's EUV resist test protocol (established 2025) provides at least a benchmark framework.

Chapter 8　Pricing and Business Models

I. Photoresist Pricing Structure

Photoresist pricing spans five orders of magnitude across generations:

Generation	Typical Price Range	Key Drivers
g-line	CNY 200–800/kg	Commodity, volume-competed
i-line (wafer)	CNY 3,000–15,000/kg	Purity tier, fab-grade premium
KrF	CNY 30,000–80,000/kg	CAR chemistry, R&D amortization
ArF Dry/Imm.	CNY 100,000–350,000/kg	Ultra-pure supply chain, long qualification cycles
EUV	CNY 1,000,000–3,000,000/kg	Extreme scarcity, early-stage MOC/SMR

II. Commercial Models

Long-term Annual Contracts: Major wafer fabs (TSMC, Samsung, SMIC) lock in photoresist supply through annual volume commitments with pricing negotiated upfront. Sole-qualified suppliers (as JSR is for many EUV layers) command stronger pricing power; commodity-equivalent products (g-line) face margin compression.

Joint Development Agreements (JDA): Suppliers co-develop resist formulations with fabs for new process nodes. The resulting formulations are typically exclusively licensed to the specific fab for a defined period, after which they may be sold more broadly. JDAs create deep customer lock-in but require suppliers to co-invest in expensive process development.

Dual-Sourcing Policy: Leading fabs maintain at least two qualified suppliers per resist type per node to ensure supply security. A new domestic supplier typically enters as the secondary source (5–15% share) before scaling to primary status. This policy is the practical path by which Chinese resists gain initial production exposure.

Chapter 9　Representative Customer Cases

I. SMIC's Photoresist Dual-Source Strategy

SMIC (Semiconductor Manufacturing International Corporation, China's leading foundry) operates the most advanced domestically available lithography nodes (28nm FinFET). Its photoresist procurement strategy has evolved from purely Japan-sourced to increasingly dual-source, incorporating Beijing Kechuang for KrF layers and (beginning early qualification) Nanda Optoelectronics for ArF layers.

At SMIC's Shanghai N+2 node production, Beijing Kechuang's KrF resist occupies an estimated 15–25% of KrF supply share across applicable layers—a substantial achievement for a domestic supplier competing against TOK and JSR on a volume production line.

II. YMTC's Material Localization Drive

Yangtze Memory Technologies (长江存储, YMTC) operates China's most advanced NAND Flash manufacturing (X-tacking 232-layer 3D NAND). Under U.S. Entity List restrictions (November 2022), YMTC faced accelerated pressure to localize materials across its supply chain. For photoresist:

KrF: Beijing Kechuang qualified as secondary KrF source; share expanding
ArF immersion: Nanda Optoelectronics samples under evaluation; formal qualification timeline estimated 2026–2027
Thick negative resist (TSV formation): partly domestic suppliers

YMTC's aggressive localization timeline serves as a forcing function for the entire domestic supply ecosystem—when the nation's most demanding fab pushes domestic qualification, it creates the data and learnings needed for other fabs to follow.

III. CXMT's DRAM Photoresist Roadmap

ChangXin Memory Technologies (长鑫存储, CXMT) is China's leading DRAM producer, targeting HBM capability. DRAM photoresist qualification is structured around bit-cell shrink roadmaps: each generation requires KrF and ArF immersion resists matched to the specific cell array patterning requirements. CXMT's close collaboration with Nanda Optoelectronics on ArF immersion resist qualification (with verification data exchange in 2025–2026) represents one of the most strategically significant domestic qualification partnerships underway.

Chapter 10　Investment, Financing and M&A

I. Government Investment: The National IC Fund (Big Fund)

China's National IC Industry Investment Fund Phase III (大基金三期) registered approximately CNY 334.4 billion (nearly USD 46 billion) in 2024, with an estimated CNY 50 billion earmarked specifically for semiconductor materials (including photoresist). This represents an unprecedented capital mobilization for a materials subsector.

Phase III capital flows to photoresist follow two channels: direct equity investment in leading domestic companies (Tongcheng/Beijing Kechuang, Nanda Optoelectronics, Jingrui, Yako Technology), and support for upstream raw material companies (Eight-Hundred-Millions for ArF resin, PAG synthesis capacity expansion).

II. JSR's Nationalization: The Geopolitical Benchmark

The JIC acquisition of JSR (completed April 2024, ~USD 6.3 billion enterprise value) is the defining geopolitical transaction in global photoresist. The Japanese government, through METI's authorization of JIC as the acquirer, explicitly prevented a potential private equity or non-allied acquisition. Post-acquisition, JSR continues operating normally but under national-security-aligned governance—a model that effectively converts Japan's photoresist crown jewel into a state strategic asset.

For China, this event carries a direct lesson: Japan will not allow its photoresist companies to be acquired by Chinese entities as a shortcut to technology acquisition. The path to EUV resist capability must therefore be organic development rather than M&A.

III. Venture Capital and Domestic Listing Trends

Chinese photoresist-adjacent companies have attracted significant capital market attention since 2021. Key capital events 2022–2026:

Nanda Optoelectronics: multiple private placements funding ArF capacity expansion; market cap growth 5× from 2021 to 2025
Yako Technology: private placement for PAG capacity expansion (2023); EUV materials positioning
New entrants: Dinglong Shares (鼎龙股份) commissioned 300-ton photoresist production in early 2026, entering the market as a scale player

Chapter 11　Policy and Standards

I. China's Semiconductor Materials Policy Framework

Made in China 2025 and "14th Five-Year Plan": Explicitly targeted 80% domestic semiconductor materials supply rate by 2025 (a target not met; actual 2025 figure ~15–20% for advanced resists), recalibrated to 80% by 2030 under "15th Five-Year Plan" planning discussions.

Big Fund III (2024–): The CNY 50 billion materials tranche covers: ArF/EUV resist development grants, PAG synthesis capacity subsidies, shared R&D infrastructure (EUV test chamber access), and talent program co-funding.

Ministry of Science and Technology Key R&D Projects: Multiple "key special projects" specifically targeting photoresist, PAG, and ancillary chemicals, with CNY 200–500 million grants per project awarded on competitive basis to leading companies.

II. Japan's Export Controls

Japan's photoresist export control framework has been tightened in two major steps:

July 2023: Japan added 23 semiconductor-related items to its export control list, including several photoresist precursors, EUV-related photomaterials, and semiconductor manufacturing equipment categories. Exports to China now require individual licenses (previously eligible for simplified procedures).

October 2025: Japan applied 25% tariffs on 19 categories of semiconductor materials exports to China, adding cost friction on top of the licensing requirements. Japanese suppliers estimate total transaction cost increase of 15–30% compared to pre-2023 baseline.

III. EUV Photoresist Standards Development in China

China's national standards body (technical committee for photoresist) established an EUV photoresist test standard working group in 2025, producing the first draft specifications in early 2026. Though no EUV tools exist domestically to implement full qualification, the standards framework provides a reference for:

EUV sensitivity measurement protocols (calibrated synchrotron sources as proxy)
LER/LWR measurement standardization
Metal oxide resist EHS (environmental health and safety) classification

Chapter 12　Trends and Tianxia Gongchang Research Institute Outlook

I. KrF: Scale Breakthrough Confirmed (2026–2027)

The Tianxia Gongchang Industrial Research Institute, in its systematic study of domestic industry supply chains, concludes that KrF is at a scale breakthrough inflection point: Beijing Kechuang and other domestic suppliers have cleared the critical qualification threshold for leading wafer fabs, and the supply window is open for rapid scaling. Market tailwinds (mature node capacity expansion, HBM-driven demand) and policy push (Big Fund III procurement support) are aligned—we assess KrF reaching 25–30% domestic supply share by year-end 2026 or early 2027 as a high-probability scenario.

II. ArF Immersion: Ramp Year (2026–2027)

The pace of Nanda Optoelectronics' 500-ton new production line ramp is the single most important leading indicator for China's ArF localization trajectory in 2026. If ramp proceeds as planned (>20 MT/month by end-2026), the 2027 ArF milestones will arrive ahead of schedule. Geopolitical pressure is compressing fab qualification timelines in our favor—what previously took 36–60 months under stable conditions is being accelerated toward 24–36 months under supply security imperatives.

III. EUV: Foundation Year (2026)

National EUV test standards, early domestic EUV resist synthesis prototypes, and academic research output from Peking University and SICC mark 2026 as the year China transitions from "no EUV activity" to "foundational EUV R&D infrastructure." Commercial EUV supply is 7–10 years out; the groundwork laid now determines whether China participates in the next generation at all.

IV. Structural Trends Shaping the Next Five Years

Structural Tailwind 1 — AI Compute Demand: AI large model training and inference require massive compute chips (GPUs, ASICs), which drive HBM memory demand, which drives advanced KrF and specialized thick-resist demand. China's AI investment wave will be an enduring demand driver for domestic photoresist.

Structural Tailwind 2 — Mature Node Proliferation: Under U.S. export controls, China's fab investment is overwhelmingly in 28nm+ mature nodes. This is exactly the domain where domestic photoresist (i-line, KrF) is most competitive and where localization gains are fastest.

Structural Headwind 1 — Japan's Export Control Escalation Risk: Further tightening of Japan's export controls on photoresist precursors (PAG, resin monomers) would create raw material supply shocks that no domestic formulator can fully absorb in the short term.

Structural Headwind 2 — Qualification Cycle Inertia: Even with political will and capital, qualification cycles cannot be compressed below a physical minimum. Quality data takes time to accumulate; process integration learnings require real production exposure.

Consolidated Outlook: "KrF inflection confirmed, ArF accelerating ramp, EUV foundational groundwork" — this is the Research Institute's core characterization of China's semiconductor photoresist industry in 2026, and the most important cognitive baseline for understanding the industry's trajectory through 2030.

Chapter 13　Risks

I. Supply Chain Risks

PAG Supply Disruption: ~80% of global PAG supply is concentrated in Japan. Any expansion of Japan's export controls to include specific PAG molecular classes would directly impact domestic KrF/ArF formulation capacity with limited short-term alternatives.

ArF Resin Single-Source Risk: Eight-Hundred-Millions is currently the only domestic mass-production source of ArF resin. A production disruption (fire, equipment failure, quality incident) would immediately impact Nanda Optoelectronics' supply capacity.

Ultra-Pure Chemical Supply: Electronic-grade PGMEA, TMAH, and hydrogen peroxide at semiconductor-grade purity still depend partly on Japan (Tokuyama, Mitsubishi Chemical, Kanto Chemical) for the highest-purity tiers. Expanding domestic ultra-pure chemical capacity is a precondition for full-stack localization.

II. Technical Risks

RLS Trilemma Wall: Domestic CAR developers will hit the same fundamental physics limits facing Japanese incumbents. EUV shot noise is a material science problem, not a manufacturing scale problem—more investment doesn't solve it without genuine chemistry innovation.

Wafer Fab Process Lock-In: Wafer fabs globally (including Chinese fabs) have deep process optimization embedded around specific approved resists. Even technically superior alternatives face multi-year re-qualification before displacing incumbents—technical merit alone is insufficient.

Talent Scarcity: The global pool of ArF/EUV photoresist chemists with 10+ years of relevant experience is in the hundreds. China's share of this talent pool is small. High-end photoresist development is expert-intensive; talent accumulation has a minimum clock speed that cannot be compressed by money alone.

III. Geopolitical Risks

Escalating Coordinated Controls: The U.S., Japan, Netherlands, and South Korea are increasingly coordinating semiconductor export controls. Coordinated restrictions on photoresist raw materials (not just finished goods) would create compounding pressure.

Taiwan Strait Scenario: A high-tension or conflict scenario would immediately sever TSMC-linked supply chains globally, triggering extreme photoresist hoarding and reallocation. While this would create short-term domestic sourcing pressure, the longer-term effect could be an accelerated qualification of domestic alternatives—a double-edged dynamic.

IV. Business Risks

Valuation Compression: Chinese photoresist stocks have traded at significant premium multiples (50–100× P/E at peaks) reflecting future optionality. If localization progress is slower than market expectations, multiple compression could be severe.

Overcapacity Risk: If all announced domestic capacity expansions (Nanda Optoelectronics 500T, Dinglong 300T, plus pipeline projects) ramp simultaneously faster than demand absorption, KrF/i-line could face temporary oversupply and margin compression in 2027–2028.

Data Sources

This research report was prepared by the Tianxia Gongchang Industrial Research Institute; data baseline date: June 19, 2026.

Tianxia Gongchang Platform Data

Tianxia Gongchang (www.tianxiagongchang.com) is one of China's largest active factory B2B data platforms, aggregating authentic operating data on 4.8 million active Chinese factories, covering supplier information across thousands of sub-categories including semiconductor materials, fine chemicals, electronic chemicals, and photosensitive materials. Supplier distribution statistics for photoresist, developer, stripper, photosensitive resin, and related keywords cited in this report—including Beijing Kechuang (27 records), Nanda Optoelectronics (4 records), and Shanghai Xinyang (8 records)—are sourced from real-time statistics of the platform's factory database, with research analysts conducting cross-validation from both supply and demand dimensions.

Listed Company Public Disclosures

Nanda Optoelectronics (300346): 2025 interim report, 2025 investor relations activity records, interactive platform Q&A
Tongcheng New Materials (603650): 2025 Q3 report, first-coverage initiation report by Shanghai Securities (March 2025)
Jingrui Electronic Materials (300655): 2024 annual report summary, 2025 interim report
Yako Technology (002409): Multiple earnings call transcripts, 2025 equity increase announcements
Shanghai Xinyang (300236): EUV photoresist patent announcements, investor meeting minutes

Industry Research Institutions

Zhiyan Consulting: China Semiconductor Photoresist Industry Policy, Supply Chain, Development Status and Future Trend Assessment 2025
Caitong Securities: Photoresist Localization Rate Below 1%, Key Window for High-End Substitution Opens (March 2026)
Mordor Intelligence: Photoresist Market Share & Industry Report (2025)
Fortune Business Insights: Photoresist Chemicals Market Size, Share & Industry Analysis 2026–2034
Archive Market Research: KrF Photoresist 2025–2033 Overview

English-Language Primary Sources

ASML Annual Report 2024 & 2025 H1 Investor Presentations
JSR Corporation Annual Report 2023 (pre-nationalization)
TOK (Tokyo Ohka Kogyo) Annual Report 2024
TechInsights: EUV Photoresist Technology Roadmap 2025
IEEE Transactions on Semiconductor Manufacturing: Multiple CAR chemistry papers (2022–2025)
Science: "Metal oxide cluster photoresists for EUV lithography" (representative academic reference)
Digitimes: Taiwan DRAM/NAND supply chain analysis (2025–2026 series)
Nikkei Asia: Coverage of JSR nationalization, Japan semiconductor materials export controls (2023–2025)

This report was prepared independently by the Research Institute for industry research reference purposes and does not constitute investment advice. Please cite the source when reproducing.