Sail across the sea

Chapter 461 Tell Me Your Requirements
“But if the US can get Japanese manufacturers to cut off supplies to South Korea, it can also get Chinese manufacturers to cut off supplies to South Korea,” Choi Kyung-ran said.

Gao Fan chuckled: "President Cui, you're overthinking it. If China also succumbs to American pressure, do you think South Korea will still have a reason to exist?"

"..."

Cui Jingran felt a mouthful of blood rise to his throat, but he silently swallowed it back down.

The words may be harsh, but the truth is undeniable. While their language may be unpleasant, it's the absolute truth. If the US and China reach a consensus, will South Korea still have time to worry about photoresist? At that point, it will be like a fish on a chopping board, completely helpless to be manipulated.

It must become powerful!
When South Korea becomes powerful enough to easily crush the five permanent members of the UN Security Council, I will definitely drag this despicable guy under the flag of the Taegeukgi and make him kneel down.

Hmm, it seems there are too many people kneeling there, not enough space...

Forget it, now's the time to dream. Let's solve the immediate problem first. This young man's reminder is correct; Guangchen Semiconductor does indeed need to establish its own contingency mechanism immediately.

A strategist in ancient Korea named Bong Xuan once said that a cunning rabbit needs three burrows. Similarly, a company cannot rely entirely on a single source for its raw materials.

While friction between Japan and South Korea is unlikely to occur anytime soon, adapting to a new photoresist takes time.

“Tell me your requirements,” Cui Jingran said.

Gao Fan stated directly, "China's Shuangye Fine Chemicals plant hopes to sign a photoresist supply contract with Guangchen Semiconductor. Guangchen Semiconductor will purchase no less than 50 tons of photoresist from Shuangye annually over the next five years, with a supply price of US$15 per ton of photoresist."

“But even Moriya’s photoresist only costs $15 per ton,” Cui Jingran questioned.

"Moriya's i-line photoresist was developed based on its patented frosting process. In photoresist R&D, China's technology is ahead of Moriya's."

"but……"

"President Cui, you don't think that the plans I've made for your company aren't worth $750 million, do you?"

"..."

Cui Jingran was speechless. Gao Fan's reasoning seemed very strong, and he didn't know how to refute it.

Actually, what he just did was just a subconscious reaction: no matter what price the other party quoted, he had to cut it down, otherwise he would be letting down his business administration degree.

If you think about it carefully, 50 tons of photoresist at $15 per ton would only amount to $750 million a year, which is not a very large number compared to the annual output value of Guangchen Semiconductor.

I was just discussing important matters of international peace with the other party, but in the blink of an eye, we're arguing about whether a ton of photoresist should sell for $15 or $13. It does seem a bit inappropriate.

“50 tons a year is too much for us. We can’t possibly convert all our production lines to use Chinese photoresist. Without sufficient testing, I can only use one production line for experiments at most,” Cui Jingran said.

How much photoresist is needed for a production line?

"A maximum of 20 tons."

"This quantity is too small. Our factory's annual production capacity is 200 tons." "You don't mean you only plan to sell to us as your sole customer, do you?"

“Of course not,” Gao Fan said. “But you should know that several electronics and chemical companies from Japan, the United States, and West Germany have formed an alliance to boycott our products. The electronics exhibition has been going on for three days, and we haven’t sold a single gram of photoresist.”

“I do know about this,” Cui Jingran said.

Moriya and other companies did indeed form an alliance, though this was merely a verbal agreement without any written documentation. These electronics and chemical companies within the alliance have been sending messages to semiconductor manufacturers in recent days, not explicitly stating it, but essentially hoping that the semiconductor manufacturers will not cooperate with the Chinese.

As for the reasons, they are of course very high-sounding, such as the belief that the background of the Frost Leaf Chemical Plant is a research institution of the Chinese military, and that cooperating with Frost Leaf would indirectly help China's military development.

The representatives of each electronics manufacturer were not fools; they all knew that the goal of these electronic chemical manufacturers was to suppress a newly emerging competitor in order to maintain their monopoly position in the electronic chemicals market.

Given that Shuangye Chemical Plant was not well-known, no one thought that supporting such a company would be of any benefit to them, so they simply did a favor and agreed not to consider photoresist produced by Chinese companies.

Before talking to Gao Fan, Cui Jingran had the same idea. But now, his thoughts have changed.

He realized that the electronics and chemical manufacturers in Japan, the United States, and West Germany did this not only for profit considerations, but also with a deeper intention: to force semiconductor manufacturers to depend on them, which was a noose around the necks of semiconductor manufacturers.

“I can persuade several other South Korean semiconductor companies to also use your country’s photoresist,” Choi Kyung-yeon promised.

He was somewhat confident in his promise. He had connections with the heads of several other semiconductor companies in South Korea and was aware of their respective political leanings. He believed that those companies, like Guangchen Semiconductor, would recognize the crisis they faced and choose to establish a backup channel in China.

Gao Fan asked, "How many tons of Chinese photoresist do you estimate South Korean companies, including Guangchen Semiconductor, can consume in a year?"

“Around 80 to 100 tons,” Cui Jingran said.

Gao Fan breathed a sigh of relief. If the demand was that large, the problem with Shuangye Chemical Plant would be solved. China could also absorb some of the photoresist domestically, and with some more sold in other markets in the future, it was possible to reach a demand of over 100 tons per year.

The designed production capacity of the frosting plant is 200 tons, but it is not necessary to produce 200 tons. If market demand is insufficient, even if only 100 tons are produced per year, at $1500 per ton, the output value would be $15 million, which is equivalent to 4500 million yuan.

In fact, the current value of the RMB is severely overvalued. The official exchange rate is 1 US dollar to 2.93 RMB, but on the black market, 1 US dollar can even be exchanged for 10 RMB. To encourage exports and foreign exchange earnings, various regions provide substantial subsidies to export companies after foreign exchange settlement.

Based on this calculation, Shuangye Chemical Plant will not lose money no matter what.

"Besides photoresist, we plan to develop other semiconductor chemicals, including specialty gases, dopants, etchants, solvents, and cleaning materials. We hope to cooperate deeply with Korean companies in these areas," Gao Fan said.

"I believe this kind of cooperation is absolutely necessary."

"So, may I say to President Cui that it's been a pleasant collaboration?"

"Yes, it's a pleasure to work with you!"

(End of this chapter)