[News] Japan Photoresist Suppliers Flag Shortage Amid >40% Middle East Naphtha Reliance, Risks for Chipmakers

Amid disruptions in the Middle East, shortages of key materials are raising concerns across the global semiconductor supply chain. According to South China Morning Post, citing The Elec, the Strait of Hormuz has been effectively closed since early March, sharply curtailing supplies of naphtha—a key feedstock for specialty chemicals used in semiconductor production. This has reportedly prompted Japanese suppliers to warn of potential photoresist strain.

Sources cited by The Elec say major Japanese photoresist suppliers have either informed or are preparing to inform customers such as Samsung Electronics and SK hynix about disruptions in raw material procurement.

To further explain, The Elec notes that photoresist production relies on solvents such as PGME and PGMEA, which are now in short supply. The shortage is linked to the Iran war, as naphtha supply has been disrupted. Naphtha, a key feedstock derived from crude refining, produces intermediates such as propylene when cracked at high temperatures. This is then used to produce propylene oxide (PO)—a critical precursor for PGME and PGMEA.

Semiconductor materials that depend on PGME and PGMEA include photoresists, thinners, bottom anti-reflective coatings (BARC), spin-on hard masks (SOH), and temporary bonding adhesives used in HBM, The Elec notes.

Japan’s Reliance on Middle East Naphtha Highlights Risks for Chipmakers

Japanese suppliers providing these materials to Samsung and SK hynix include Shin-Etsu Chemical, Tokyo Ohka Kogyo, JSR Corporation, Fujifilm, and Nissan Chemical, as noted by The Elec.

Japan currently relies on the Middle East for more than 40% of its naphtha supply. The Elec reports that Japanese photoresist and related material manufacturers may consider sourcing PGME and PGMEA from Korea or China.

However, according to The Elec, a key hurdle lies in the Process Change Notification (PCN) procedure, meaning this may not be a quick solution. If the raw materials used in these products are altered, Samsung and SK hynix must requalify them, a process that typically takes about one year and can take even longer for leading-edge processes.

Photoresist Supply Outlook and Regional Impact

At the same time, the broader implications remain under close watch. As highlighted by South China Morning Post, the shortage is expected to have the greatest impact on advanced nodes that rely on extreme ultraviolet (EUV) lithography, while Taiwan and South Korea remain the largest markets for photoresist.

On potential risks, South China Morning Post notes that semiconductor manufacturers typically maintain several months of safety inventory, with partial substitution from U.S. supplies potentially supporting chip output for around six months. The report adds that TSMC continues to diversify its supply strategy and has built a globally diversified supplier base. Major chipmakers are also said to maintain inventory buffers for key materials ranging from several weeks to a few months.

Meanwhile, South China Morning Post notes that China’s chip supply chain has been advancing its push for self-sufficiency, a trend that may help cushion the impact of potential global photoresist shortages. Domestic players, including Xuzhou B&C Chemical, have been expanding capabilities in areas such as photoresist.

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(Photo credit: Shin-Etsu Chemical)