Chart of the Day: Here's where our semiconductors go

Semiconductor exports in 2016 largely went into Chinese mid-tier phones.

Whilst semiconductor manufacturing is forecast to grow at a more moderate pace from the second quarter, the good news is that supporting industries are benefitting from the prolonged growth in semiconductor demand.

RHB reported that a late surge in semiconductor demand boosted manufacturing output in 2016, with smartphones and personal computers still the top consumers of semiconductors last year. As for 2016 semiconductor exports, a huge part went into Chinese mid-tier phones.

"In contrast, 2017 would likely be dominated by flagship phone launches, which have lower sales volumes compared to the mid-range to low-end offerings, especially with Chinese carriers opting to stop subsidising new phones and Apple’s iPhone 8 price being expected to top US$1,000 for the first time. All things considered, we expect semiconductor manufacturing to grow at a more moderate pace from 2Q onwards," noted RHB.

It added that the prolonged growth in semiconductor demand is starting to spill over into supporting industries such as precision engineering and plastics sectors.