"Russia-Ukraine Tensions Pose Minimal Risk to Semiconductor Production Halt"

Alternative supply remains available and supply from other regions is also possible
There is a possibility of increased wafer production costs

[Asia Economy Reporter Park Sun-mi] Although tensions between Russia and Ukraine may lead to increased semiconductor production costs, it is expected that these tensions will not result in semiconductor production disruptions.

On the 16th, market research firm TrendForce dismissed concerns that the tension between Russia and Ukraine could cause supply disruptions of essential raw material gases such as neon, krypton, argon, and xenon, which are critical for semiconductor production, potentially leading to production setbacks. While Ukraine currently accounts for about 70% of the world's neon supply, there is sufficient alternative supply available.

TrendForce stated, "Although the Russia-Ukraine conflict may affect the supply of inert gases necessary for semiconductor production, semiconductor factories and gas suppliers have already stockpiled adequate quantities, and alternative supplies can be sourced from other regions to replace Ukraine." They added, "There will be no semiconductor production line shutdowns due to disruptions in Ukrainian gas supply. However, a reduction in gas supply could lead to price increases, which may raise wafer production costs."

Korean semiconductor companies, including Samsung Electronics, are also preparing for potential impacts on semiconductor material supply chains due to changes in the Russia-Ukraine situation but have already established response systems, so production is not expected to be affected. Although there is a high dependence on Ukrainian inert gases, they have prepared response measures through diversification of trading partners.

An industry official said, "In 2019, when Japan tightened export regulations on key semiconductor materials to Korea, the semiconductor industry experienced a supply shortage once, and recently, the entire industry faced aftereffects from the urea solution shortage crisis. Therefore, the semiconductor industry has long been preparing to diversify supply chains," adding, "There is no significant immediate impact."

This content was produced with the assistance of AI translation services.