China hits record $26 billion in chip material imports

China’s imports of semiconductor manufacturing equipment hit a record high in the first seven months of this year as companies in the Asian nation continue to ramp up their purchases in case the US and its allies block them from buying further.

Chinese companies imported nearly $26 billion worth of chipmaking machinery, according to trade data released this week by China’s General Administration of Customs. That surpassed the previous record set in 2021 and comes as U.S., Japanese and Dutch authorities work to tighten restrictions on Chinese companies.

Chinese purchases of companies including Tokyo Electron Ltd., ASML Holding NV and Applied Materials Inc. have surged over the past year. During that period, Chinese companies have bought more lower-tech equipment as the U.S. and its allies tightened controls on access to more advanced technologies. That buying spree has helped drive Dutch exports to China to new heights, topping $2 billion in July for the second time ever.

Dutch company ASML’s sales to China rose 21% in the second quarter, accounting for nearly half of its total revenue, with sales made up of older, unconstrained systems as Beijing seeks to manufacture more mature types of semiconductors. ASML is the sole supplier of the most advanced lithography equipment needed to make next-generation chips. China’s Semiconductor Manufacturing International Corp. relied on ASML’s previous-generation lithography machines to achieve a technological breakthrough last year, as reported by Bloomberg News.

Chinese chipmakers are expected to increase their output by 14% to 10.1 million wafers per month in 2025, or nearly a third of the global industry’s output, after achieving a 15% increase this year, trade association SEMI estimated in June.

The U.S. has been tightening rules that restrict China’s progress in critical technologies, including semiconductors and AI. Those measures include repeated rounds of export controls that limit the sale of advanced chips and equipment capable of making those components.