Weekly Supply Chain in Asia 2026-W33 (2026-08-06~2026-08-12)

This week, the United States Department of Commerce finalized export restrictions on tungsten waste and black mass, while President Donald Trump signed a proclamation imposing a 15% tariff and price floors on polysilicon. By requiring US suppliers of tungsten waste and black mass to sell to the domestic market, the restriction could encourage investment in US refining facilities. Major industrial players are also changing where they put capital. From Amkor Technology, a US-based semiconductor packaging and test provider, and SK Hynix, South Korea’s second-largest chipmaker, reviewing the divestment of their Chinese semiconductor packaging operations, with Amkor planning to put the proceeds toward US packaging capacity, to the UAE evaluating an east coast LNG facility to bypass the Strait of Hormuz, firms in semiconductors, energy, and defense each reconsidered where their capital sits this week.

This Week’s Events

Semiconductor Bifurcation and Capital Reallocation

The global AI and semiconductor industries are projected to experience a deepening bifurcation. Amkor Technology and SK Hynix are both reviewing the potential sale of their China-based operations. Amkor Technology has selected an advisor to separate its China business, valued between USD 1B and USD 1.5B, while SK Hynix is evaluating the sale of its Chongqing packaging plant, estimated at USD 3B. Amkor Technology plans to withdraw from or scale down its China business and put the resources secured there toward strengthening its packaging capabilities in the United States, where it is building a large-scale packaging facility in Arizona.

Major Chinese semiconductor and AI entities are moving in the opposite direction. Companies including ChangXin Memory Technologies, China’s largest domestic DRAM manufacturer, and Yangtze Memory Technologies, a Chinese NAND flash maker, are pivoting away from US stock exchanges in favor of domestic listings on the Shanghai STAR Market and the ChiNext board. Supported by the Chinese government’s “Big Fund,” these firms are using domestic liquidity to build indigenous supply chains, specifically executing low-price volume offensives in general-purpose memory segments like DDR4 and NAND. For South Korean memory manufacturers, this creates a structural imperative: they must accelerate the migration to high-value, next-generation products like HBM3e, HBM4, and CXL to maintain profitability, as the general-purpose segment becomes increasingly commoditized by Chinese volume-based strategies.

Resilience-First Infrastructure

ADNOC Gas, the UAE’s state-owned gas company, is evaluating the construction of a new LNG export facility on its east coast to bypass the Strait of Hormuz. The project, which would require a multi-billion USD investment and a new pipeline connecting west coast gas fields, is a direct response to the heightened energy transport risks in the region, where 15 vessels have been struck by attacks since the conflict began. The move to bypass the Strait of Hormuz is also spreading to other Gulf producers: Saudi Arabia is reviewing an expansion of its East-West pipeline export capacity, and Iraq is pursuing the restoration and construction of pipeline networks to Syria and Turkey.

In defense, Hanwha Group, a South Korean conglomerate, is bidding for a US shipyard. Hanwha Defense USA has submitted a non-binding proposal to acquire 100% of Austal USA, a US shipbuilder specializing in vessels for the US Navy and Coast Guard, for USD 1.05 billion to USD 1.2 billion. If completed, the acquisition would give Hanwha Group a production base tied to the supply chain for US Navy nuclear submarines, and the move aligns with the US government’s policy direction of reviving its weakened domestic shipbuilding industry. This move follows Hanwha Ocean’s launch of a VLCC shipowner business, a platform Hanwha Ocean says it set up to build cooperative relationships with customers.

Trade Policy as a Localization Lever

The United States’ new export restrictions on tungsten waste and black mass, effective later this month, are designed to strengthen domestic supply chains by mandating that these intermediate materials remain within the US. Financial distress among North American battery recyclers also constrains refining capacity expansion: Ascend Elements filed for bankruptcy in April, and Li-Cycle filed for bankruptcy protection last year. Fastmarkets expects the restriction could significantly reduce the black mass volume available to Asian recyclers, with importers of nickel, cobalt, and manganese feedstock in South Korea and Southeast Asia particularly affected.

Separately, Bangladesh and the Republic of Korea signed a Comprehensive Economic Partnership Agreement (CEPA) on August 4, 2026. The agreement provides preferential tariff treatment for 97% of Bangladeshi products and 87% of Korean products, while opening 95 and 111 service sub-sectors respectively. The CEPA is expected to promote technology transfer and the movement of highly skilled human capital, as Bangladesh’s Least Developed Country status is set to expire. For Korean firms, the agreement provides a framework to utilize Bangladesh as a destination for manufacturing investment.

Capital Efficiency and Operational Management

POSCO Holdings is selling down two subsidiaries. POSCO Holdings, a South Korean steel and materials group, approved the sale of 20.7% of POSCO International and 23.5% of POSCO DX for a total of KRW 2.5 trillion (USD 1.76 billion). POSCO Holdings stated that both disposals are intended to secure strategic investment resources. The company also plans to enter into three-year Price Return Swap contracts on the disposed shares, which settle the difference between the actual sale amount and the base price per share.

Elsewhere, Cushman & Wakefield Korea reports that the Seoul hotel market is shifting from a development-led to an operation-led model, and says that with new supply constrained at 1,000 rooms per year and inbound demand continuing, hotels with competitive operations are likely to see cash flow and asset value rise at the same time.

In Japan, average annual compensation in the banking sector reached JPY 6.84 million for the 2025 fiscal year, with Sumitomo Mitsui Banking Corporation exceeding JPY 9 million for the first time.

In Brief

• Gaon Cable, a South Korean power cable manufacturer, secured a KRW 60B contract with Singapore’s Land Transport Authority to supply distribution cables for the city-state’s Mass Rapid Transit power grid, its first supply contract with the authority.
• The Liter, a South Korean coffee franchise with over 400 domestic locations, is launching its first overseas flagship store in Tokyo in August 2026, planning to use its identity as Korea’s first 1L coffee brand to expand Tokyo’s large-volume coffee market directly.

Looking Ahead

The coming weeks will test the durability of these “resilience-first” strategies. Hanwha Group’s acquisition of Austal USA must pass regulatory approvals to be finalized. Simultaneously, the market will watch for the formal effective date of the US polysilicon tariffs on December 4, 2026, and the subsequent impact on semiconductor wafer procurement costs for manufacturers like Samsung Electronics and TSMC. Finally, the divestment timelines for Amkor Technology and SK Hynix will reveal whether the assets are purchased by Asian investment firms or semiconductor companies.