context: Launched in 2014, IC Big Fund aims to break foreign dominance in this key sector. The fund’s phase 2, worth 200 bn and meant to attract 1 tn in co-investment, began earmarking funds for high-end gear and new materials in March 2020. Yangtze Memory is the flagship project, with astronomical investments starting to pay off.

China’s first 128-layer 3D NAND memory chip was revealed on 13 Apr 2020, reports Caixin. The announcement beat industry expectations, says the report, given the short 4-year history of its producer. Tsinghua Unigroup’s Yangtze Memory aims to mass-produce the new chips in H2 2020, but unnamed industry insiders told Caixin production quality needs to improve first. That puts Yangtze Memory about one year behind international competitors, says the report. In June 2019, Korea’s SK Hynix announced the mass-production of similar chips, as well as R&D for its next-gen 176-layer products. Other developers such as Samsung and Micron followed shortly after.

Set up in 2016 with a US$24 bn budget, Yangtze Memory received the largest single investment from the IC big fund (US$12 bn), along with support from the Wuhan government, reports Caixin (Note: Big Fund will sustain investments during phase 2). COVID-19 had a limited impact, as the Wuhan-based firm did not cease production even at the height of the citywide lockdown, said Simon Yang Shining 杨士宁 Yangtze Memory CEO in early April.

Yangtze Memory’s sales will be boosted by the US chip ban, Caixin anticipates. The firm will ramp up production to grab five percent of the global NAND market, predicted Tianfeng Securities in March 2020.