[News] Iran Conflict Reportedly Drives 50%+ Helium Spot Price Surge; Samsung, SK hynix on High Alert
The Iran conflict has put the semiconductor industry on alert, raising concerns over procurement and cost pressures for critical materials. According to The Elec, South Korea’s chip sector is closely monitoring the situation on a daily basis amid fears that supply disruptions could affect key inputs such as helium, thinner, ethanol, and isopropyl alcohol (IPA).
As the report notes, companies such as Samsung Electronics and SK hynix are prioritizing securing sufficient inventory at prevailing market prices, with supply stability now taking precedence over cost considerations. The report adds that while these materials account for only a small share of overall chip production costs and are unlikely to directly impact pricing, the risk of supply disruptions remains a major concern.
Helium Supply Risks Intensify
Helium supply has become an immediate concern, with spot prices surging and industry estimates pointing to increases exceeding 50%, as the report notes. The report adds that even if peace negotiations are reached, restoring facilities in Ras Laffan could take years, leaving supply shortages and price volatility as medium- to long-term risks.
Helium, produced as a byproduct of LNG, depends heavily on Qatar, which accounts for roughly one-third of global supply. Following reported attacks by Iran on the Ras Laffan industrial complex, damage to LNG infrastructure could disrupt long-term supply contracts, with QatarEnergy CEO Saad al-Kaabi cited as saying about 17% of the country’s LNG export capacity has been affected.
As for Taiwan’s chipmakers, MoneyDJ notes that while TSMC and UMC have achieved helium recycling rates of 60% to 75%, significantly reducing reliance on imports, this buffer is not sufficient. About 25% of daily losses still need to be replenished through imports, and recycling systems are highly power-intensive. If LNG supply disruptions lead to power rationing, recycling efficiency would be reduced.
Cost Pressures Extend Beyond Helium
Beyond helium, The Elec notes that the rise in oil prices is also increasing production costs for semiconductor materials, as thinner, ethanol, and IPA, being petrochemical-based, are closely tied to crude oil and naphtha prices.
Thinner, used in photolithography to remove residual photoresist, is derived from propylene oxide (PO), which is processed into PGME (propylene glycol monomethyl ether) and PGMEA (propylene glycol monomethyl ether acetate). As the report notes, suppliers including DuPont, Dow, and LG Chem have issued price hike notices to PGMEA producers, with PGME and PGMEA prices rising by 40% to 50%. Meanwhile, downstream players including Dongjin Semichem, ENF Technology, and Dongwoo Fine-Chem are preparing to pass on part of the increase, planning price hikes of around 20% for April shipments.
The Elec adds that ethanol and IPA prices are also moving higher. South Korean suppliers have begun issuing price hike notices this week, with increases expected to reach double-digit percentages. Semiconductor-grade ethanol, with purity above 99.99%, is used for wafer cleaning and post-etch residue removal. IPA, another naphtha-derived material, is also trending higher, with LG Chem serving as a key supplier in South Korea. As the report notes, while the exact scale of price increases has yet to be finalized, the industry broadly expects upward adjustments.
Read more
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(Photo credit: Samsung)
