Answering your second question, Silicon wafers are made from from an ingot of monocrystaline silicon[1], as the fault line formed from the boundary between two crystals could interfere with circuit operation. Said ingots are often made with the Czochralski method, wherein a seed crystal is dipped into a crucible of molten silicon and slowly pulled upward. The silicon required for this process is nine-9s purity, so there'd be a number of steps beforehand to convert sand or even relatively pure silicon dioxide to such highly-pure silicon.
Given the carefully-controlled conditions required, it's an expensive process. Whether fabs in-house their wafer production or farm it out to a supporting firm, I don't know. I could see it going both ways. I'd not be surprised if Intel or TSMC had their own in-house wafer or ingot production. But, there's more fabs than just Intel and TSMC, so I'd guess the smaller operations would get their wafers from a company that specializes in creating them.
Given the carefully-controlled conditions required, it's an expensive process. Whether fabs in-house their wafer production or farm it out to a supporting firm, I don't know. I could see it going both ways. I'd not be surprised if Intel or TSMC had their own in-house wafer or ingot production. But, there's more fabs than just Intel and TSMC, so I'd guess the smaller operations would get their wafers from a company that specializes in creating them.
1. https://en.wikipedia.org/wiki/Monocrystalline_silicon 2. https://en.wikipedia.org/wiki/Czochralski_method