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War: China and Russia can demand TSMC capacity in exchange for neon
  • Chinese sources said the price of neon gas has risen almost ninefold in the past three weeks, from 1,850 yuan to 16,000 yuan ($2,500) per cubic meter. The rise in price is due to the situation in Ukraine, which produced 45-54% of the world volume of neon. Since February 24, all this volume has become unavailable after the shutdown of factories in Mariupol and Odessa, which caused an increase in prices on the world market. Now neon is produced only in China and Russia.

    Chip manufacturers have stock of only 2-3 months and one month is already almost gone.

    Neon is used in excimer lasers in photolithographic installations (scanners) as a consumable material. Without this gas, it is simply impossible to organize the production of semiconductors. To continue working, gas will have to be bought at any price.

    I see extreme panic posts in Taiwanese media, as China and Russia already started to discuss terms of new neon supplies.

    TSMC can be forced to start production of Russian and Huawei chips again. Or stop totally.

  • 4 Replies sorted by
  • The US will have to restart large scale steel mills, so it will have the inputs for neon gas filtration. One outcome from the war in Ukraine is that globalization is KIA. There will be trading blocs, just like in the old times.

  • @radikalfilm

    They can't restart anything.

    To make any heavy steel manufacturing you need cheap energy and lots of it. Also you need ore and lot of other stuff. You also need special neon refinement plants. It all requires many years to do.

  • @Vitaliy_Kiselev I meant Horizon 2030, yes. Of course they can do it, if anyone can do it, it's the US. It's that or they withdraw the sanctions. There is no short or medium resolution, that is certain.