China stockpiling DUVi machines threatens to erase US advantage

The Center for Technology and Statecraft has published a new analysis showing that China had accumulated a growing inventory of deep-ultraviolet immersion lithography systems as of early 2026. If the 2024-2025 import pace continues, the report finds, China could close or eliminate the gap in AI-chip production versus the United States and its allies within five to ten years. The direct conclusion: current policy, which permits partial exports of DUVi systems to China, hands the West’s strongest leverage over the Chinese chip industry away for free.

Three generations, one dominant supplier

Lithography is the critical step in chipmaking: ultraviolet light “prints” circuits onto a silicon wafer. The last three generations are dry DUV (the 90s), DUVi (2006), and EUV (commercialized in 2019). Each generation prints smaller features and enables more advanced chips. The Netherlands’ ASML is the sole supplier of EUV systems and holds 99 percent of the DUVi market; Japan’s Nikon holds the remaining one percent. In other words, the entire supply chain sits with two companies from US-allied nations.

Current advantage: 50-times in AI compute

Since 2018 the United States and its allies have restricted exports of semiconductor manufacturing equipment to China. In 2019 the Netherlands blocked ASML EUV shipments, and in 2022 the restrictions were expanded to cover DUVi systems and other critical SME categories. According to the report, these steps sharply limited Chinese AI-chip production and allowed the United States to build an estimated 50-times advantage in AI compute production as of 2026. That advantage is fragile: competitive AI chips require advanced nodes — for example, “7-nanometer logic” — and those nodes demand DUVi or EUV. Nodes that rely only on dry DUV, 28 nanometers and above, are not relevant for AI.

China far from domestic production, but not from imports

The report stresses that Chinese lithography makers lag decades behind ASML and are unlikely to commercialize a DUVi system at a