Chinese tech companies, including Baidu and Huawei, are stockpiling high bandwidth memory (HBM) chips from Samsung Electronics in anticipation of new U.S. export restrictions on semiconductors to China.

U.S. authorities plan to unveil new export control measures this month, which will impose restrictions on semiconductor shipments to China, including parameters for HBM chip access.

The U.S. is expected to implement export controls that may restrict Chinese access to advanced AI processors and HBM memory, impacting the production capabilities of companies like Baidu and Huawei.

U.S. restrictions have jeopardized China's ability to manufacture alternatives to Nvidia's AI chips, with American officials pressuring suppliers to stop sales to Huawei.

Since early 2024, Chinese companies have significantly increased their purchases of HBM chips, which are crucial for AI applications.

Chinese demand primarily focuses on the HBM2E model, which is two generations behind the more advanced HBM3E, leading to supply shortages.

The global demand for advanced HBM chips has surged due to the AI boom, leading to supply constraints and prompting major producers like Micron, Samsung, and SK Hynix to expand their production capacities.

In the first half of 2024, Chinese companies accounted for approximately 30% of Samsung's HBM revenue, reflecting the increased demand.

This trend reflects China's efforts to maintain its technology ambitions amid escalating trade tensions with the U.S. and other Western nations.

The new export package is expected to detail limits on access to HBM chips, although specifics on the restrictions remain unclear.

Potential U.S. restrictions could negatively affect Samsung, which has a considerable market share in China, as Micron has already ceased HBM sales to China.

While some Chinese companies are making progress in HBM production, these efforts may be hindered by the impending U.S. restrictions.