China's chip material makers riding the AI boom close in on Japan

China’s semiconductor material suppliers are leveraging surging AI-driven demand to challenge Japan’s dominance in critical segments like photoresists, high-purity sputtering targets, and CMP slurries. This push forces domestic foundries into accelerated qualification cycles, creating a feedback loop across equipment, materials, and process integration—though yield instability and prolonged validation will inflate near-term costs. Japanese incumbents such as Shin-Etsu and JSR are likely to respond with tighter IP controls, litigation, or coordinated export restrictions with U.S. and European allies. Within 18 months, if Chinese firms master EUV-grade resists and silicon carbide epitaxial wafers, they’ll not only disrupt the $73.2B global materials market but also erode Japan’s pricing power even in mature nodes. In today’s geopolitical climate, material self-reliance has shifted from strategic preference to operational necessity.