DYNAMIC Random Access Memory (DRAM) wafer fabrication firm TECH Semiconductor Singapore is investing to upgrade its 2,000-staff-strong Woodlands plant to leading-edge technologies.

The joint-venture company between Micron Technology Inc, Canon Inc and HP Singapore is embarking on the 50 nanometre (nm) manufacturing technology and plans to adopt the 43nm technology from next year, company president Lee Kok Choy revealed in an interview with BizIT.

The upgrades are expected to incur sizeable capital investment. In March, it was reported that the Singapore government has given Micron a $300 million loan under an Economic Development Board (EDB) scheme to facilitate more investments in TECH.

'Generically, the upgrade of a technology node for a fab the size of TECH would cost US$100-300 million,' Mr Lee said. 'We are starting 50nm now - getting the tools in and starting the test wafers. It will move fairly quickly. Next year, we will begin 43nm and move quickly on that, too.'

He added that the upgrades will keep TECH, which is 85 per cent owned by US-based semiconductor firm Micron, 'very competitive' among major DRAM players.

The arrival of leading-edge fab technologies is also seen as a boost to Singapore's semiconductor industry, by helping to generate economic spin-offs in the sector and prop up related industries.

Chip makers upgrade to leading-edge manufacturing technologies to make smaller chips. This improves the efficiency and cost- effectiveness of production. Mr Lee noted that a sought-after product in the DRAM market today is the 1-gigabit DDR3 memory chip which, 'if you don't have at least a 60nm technology node, you probably won't have very good yields'.

'When you go to 2-gigabit, which is the possible step in the next one to two years, if you don't have a sub-50nm technology node, your yields will not be so good.'

TECH's DRAM wafers are assembled, tested and packaged by Micron, which markets the finished products under the Micron brand. Samsung, Micron, Hynix Semiconductor Inc and Elpida Memory Inc are the world's major producers of memory chips, which store electronic data in everything from computers to mobile devices.

TECH's latest planned upgrades come on the heels of a complex plant upgrading exercise it completed last March. The facility converted from 200mm to 300mm wafer production without shutting down - a first in the world.

The 18-month-long exercise, which involved the arduous task of raising clean room ceilings while operations carried on as usual, made TECH the third 300mm wafer fab in Singapore after Chartered Semiconductor and Taiwan's UMC.

'Our conversion to 300mm is the most important step that we have taken,' Mr Lee said. A larger wafer size makes for a more cost-competitive production line and reduces material wastage. It also lets chip makers harness newer and more advanced technologies.

The past few years have been tough on DRAM makers, who experienced price erosion due to a supply glut. However, prices have rebounded in recent months.

'We don't spend our time forecasting if the market will be good or bad; it's really something beyond our control. Our investments, upgrading and production strategies are not predicated on market conditions,' said Mr Lee.

'We are always racing to be more cost-efficient and more advanced in our technologies and will continue to move forward in that - because that's the only way to be bullet-proof in all kinds of situations.'

He added: 'The team is very encouraged by the current situation. And the fact that we have been executing successfully helps a lot.'