AJINOMOTO,DAIKIN EXPAND CHIP MATERIALS TIES WITH TAIWAN

Ajinomoto, Daikin Expand Taiwan Chip-Materials Operations as AI Boom Drives Demand

TAIPEI — Japan’s Ajinomoto and Daikin Industries are expanding their operations in Taiwan as surging demand for artificial intelligence chips pushes semiconductor manufacturers and their suppliers to strengthen local partnerships.

The moves put two major Japanese materials companies deeper into one of the world's most important semiconductor ecosystems, where demand for advanced packaging and AI-related chips is rapidly reshaping the supply chain.

The developments were first reported by Nikkei Asia and subsequently reported by Taiwanese technology media, including TechNews and DIGITIMES.

Ajinomoto targets Taiwan’s advanced chip-packaging ecosystem

Ajinomoto may be best known globally for its food products, but the Japanese group has become a major player in semiconductor materials through its Ajinomoto Build-up Film, or ABF.

ABF is an insulating material used in high-performance semiconductor package substrates. Ajinomoto says the material is used in high-performance semiconductors and has an extremely large share of the interlayer insulation market for computers and related devices.

According to the Nikkei Asia report cited by TechNews, Ajinomoto is establishing an R&D center in Taiwan as it seeks closer interaction with customers and faster development of materials needed by the rapidly changing AI-chip market.

Taiwanese companies including Unimicron, Kinsus Interconnect Technology, Nan Ya PCB and Zhen Ding Technology are among the major substrate manufacturers using ABF, according to the report.

The strategy reflects a broader change in AI hardware.

The race is no longer simply about manufacturing the most advanced processor. Advanced packaging, substrates and the materials used to connect and protect chips are increasingly becoming critical parts of the AI supply chain.

Daikin is taking a similar route

Daikin Industries is also planning to expand its Taiwan presence with a technology application center, according to the Nikkei Asia reporting cited by TechNews.

The goal is to work more closely with Taiwan's semiconductor ecosystem, allowing Daikin to better understand customer applications while accelerating testing and verification of new materials.

That could become particularly important as chip manufacturers push toward increasingly sophisticated manufacturing processes and packaging technologies.

Daikin already has a substantial semiconductor-materials portfolio, including fluorinated liquids, fluoropolymer coatings, semiconductor dry-etching materials and high-performance fluoropolymer products.

The company is scheduled to showcase semiconductor technologies at SEMICON Taiwan 2026 from Sept. 2 to 4, including materials used in semiconductor manufacturing processes, equipment and data-center applications.

Why Taiwan matters so much

The expansion comes as Taiwan strengthens its position at the center of the global AI semiconductor race.

Taiwan is home to TSMC, the world's largest contract chipmaker and a key manufacturer of the advanced processors powering the AI boom. Taiwanese President Lai Ching-te said this week that Taiwan's semiconductor ecosystem has developed into a highly integrated manufacturing cluster capable of supplying global markets.

The island's importance isn't limited to chip fabrication.

Taiwan has also built a powerful ecosystem covering chip design, wafer manufacturing, packaging, testing, substrates, chemicals and semiconductor materials.

That makes physical proximity increasingly valuable for suppliers trying to keep up with rapidly changing customer requirements.

Taiwan remains the world's biggest semiconductor-materials market

The numbers underline why Japanese suppliers are looking toward Taiwan.

SEMI reported that Taiwan remained the world's largest consumer of semiconductor materials for the 16th consecutive year in 2025, with semiconductor-materials revenue reaching US$21.7 billion. China ranked second at $15.6 billion, followed by South Korea at $11.2 billion.

SEMI also reported that global semiconductor-materials sales reached a record $73.2 billion in 2025, an increase of 6.8% from the previous year.

The continuing expansion of AI computing is expected to sustain demand for advanced semiconductor manufacturing and packaging.

SEMI has forecast that global spending on 300mm semiconductor-fabrication equipment will exceed $150 billion in 2027, driven largely by AI-chip demand, advanced capacity and supply-chain resilience.

Japan’s suppliers are not alone

Ajinomoto and Daikin are joining a broader wave of international semiconductor-materials companies increasing their presence in Taiwan.

The Nikkei Asia report cited by TechNews said other suppliers, including AGC, JSR, Merck and Entegris, have also been expanding their Taiwan operations.

The reason is straightforward: semiconductor manufacturers increasingly want materials suppliers nearby so they can collaborate more closely on development, testing and production requirements.

This is especially important for AI hardware, where advances in computing performance are putting pressure on every stage of the supply chain.

The hidden bottleneck behind the AI boom

For consumers, the AI race often appears to be about companies producing faster GPUs, CPUs and AI accelerators.

But behind those chips is a complicated network of materials and manufacturing technologies.

Substrates, insulating films, specialty chemicals, fluoropolymers, gases and other materials can determine how efficiently advanced chips are manufactured and packaged.

Ajinomoto's ABF is a particularly striking example. A company widely associated with seasoning has become deeply connected to the infrastructure behind modern computing through a material that helps enable high-performance semiconductor packaging.

Taiwan’s semiconductor advantage is becoming a supply-chain advantage

The developments also come at a time when governments and technology companies are increasingly focused on semiconductor supply-chain resilience.

Taiwan is seeking to remain a reliable global semiconductor hub while companies such as TSMC simultaneously expand manufacturing capacity overseas.

Reuters reported that TSMC is investing $265 billion in Arizona, while Taiwan is also pursuing deeper technology partnerships with Europe and other markets.

That does not necessarily reduce Taiwan's importance.

Instead, it could make the island's existing semiconductor ecosystem even more valuable as a center for research, advanced manufacturing, materials development and supplier collaboration.

What comes next?

For Ajinomoto and Daikin, the Taiwan expansion is about more than simply opening new facilities.

It reflects a fundamental shift in the semiconductor industry: as AI chips become more sophisticated, the materials surrounding those chips are becoming just as strategically important.

With Taiwan already the world's largest semiconductor-materials market and AI demand continuing to drive investment, Japanese suppliers are positioning themselves closer to the customers and technologies shaping the next generation of computing.

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