How niche Japanese firms become the leading ones in the industry

When the decision was made by Japan to step up the fighting game with South Korea a month ago, it used a lot of financial sources in the supply chain to increase the trade barrier on the export of 3 crucial materials made by a couple of Japanese firms few are aware of.

Tokyo used the most powerful weapon in its campaign with its brother country and this included a couple of its niche firms like Tokyo Ohka Kogyo Co, Shin-Etsu Chemical Co, and JSR Corp. They are the ones who produce photo-resist and hydrogen fluoride which is necessary for the development of semiconductors and displays which are used in the development of modern consumer electronics such as from Dell Technologies Inc.’s laptops, and iPhones of Apple Inc. to the entire range of devices by the technology giant Samsung Electronics Co. devices. The export of these crucial materials was prohibited by Japan except for the condition applied if suppliers secure a license and regularly renew that license.

How did they manage to stay on the leading position even after the Japanese clients stopped their export to South Korean and Taiwanese rivals? Well, the answer lies in a chain of well-timed investments which were made decades ago, in addition with a will for exploring the foreign markets and a constant refinement of manufacturing standards which are too challenging for anyone else in the industry to compete.

The story of the chairman of JSR reflects how difficult it would be for a newbie to tap into the shoes of even one of those suppliers. Koshiba led the firm’s pivot into photo-resists, which is a light-sensitive liquid employed for imprinting circuits onto silicon wafers through a process known as lithography. When it comes to having the leading chip processes, JSR is amongst the few who can deliver the goods.