On the chip battlefield, China finally stops being passively attacked

They say that the most challenging situation at the card table tests wisdom, and this time China’s moves in the chip industry chain have thoroughly rewritten the script of passive responses in the past.

Many are still worried that Japan’s ban on photolithography masks will affect the domestic chip industry, but the reality is— we simply haven’t given them the chance to play their hand. On January 7, the Ministry of Commerce announced an anti-dumping investigation into imported dichlorosilane (DCS) from Japan. Behind this seemingly calm announcement lies deep strategic considerations.

Why is Japan so eager to dump this product into China

Dichlorosilane sounds unfamiliar, but it is actually the core blood of chip manufacturing. Whether it’s logic chips or memory chips, the thin film deposition process cannot do without it. Why are giants like Shin-Etsu Chemical and Mitsubishi Chemical desperately vying for the Chinese market? On the surface, it’s profit, but at a deeper level, it’s about using market access to suppress domestic substitutes and kill off local industries.

The investigation data from applicant Tangshan Sanfu Electronic Materials says it all— from 2022 to 2024, Japanese companies have been wildly increasing exports while continuously lowering prices, with a total price decline of 31%. This is not normal competition; it’s premeditated dumping aimed at crushing emerging Chinese companies in their infancy.

The supply chain is a two-way binding, and their Achilles’ heel is also in our hands

The key point is that Japan thinks holding the photolithography mask can choke us, but they didn’t expect that their economic lifeline is also in our hands. According to a report from Nomura Research Institute, if China bans exports of critical raw materials like rare earths, Japan’s economy would evaporate by 660 billion yen (about 30 billion RMB) in just three months. That’s only a short-term impact; long-term implementation would cause unimaginable losses.

This is why the power of anti-dumping investigations is so significant—it tells the other side that we can precisely counter within WTO rules and also hold chips that can paralyze their economy.

This is not chaos, but a well-founded strategic response

Many worry that this approach might be irrational, but in fact, it’s quite the opposite. The entire anti-dumping process strictly follows WTO regulations, with domestic companies formally applying and providing sufficient evidence, each point solid. The truly irrational actors are those companies trying to dominate through technological monopoly and price wars to bully others.

In the past, we emphasized “retaliation after the fact” and giving face to the opponent, but now we see a clear fact— talking reason with certain opponents is useless; strength is what matters. Our country actually has the capacity to produce dichlorosilane, but it has been suppressed by Japan’s low-price strategy. Now, with the government stepping in, not only are domestic industries protected, but a clear signal is also sent to the other side.

New rules at the card table

Japan’s current reaction is quite interesting—companies are shouting about supply chain disruptions, politicians are flailing around. But they forget a basic fact: any high-end industry chain that leaves China’s raw materials and markets will come to a halt in minutes.

The biggest shift in this round of actions is that China is no longer passively attacked but actively defining the new rules of the game at the table. Next, Japan may resort to various small tricks or even team up with other countries to pressure us, but so what? If we let them recklessly dump and choke us today, the cost we pay tomorrow will be far more than just hundreds of billions of RMB.

Since the game has already started, it’s time to set new rules. This countermeasure is not just about protecting the chip industry but also about making everyone understand— if you want to snatch food from China’s bowl or break China’s pot, there’s no way in.