Ukraine stops supplying neon gas, essential for chip production

Every day we have news about the consequences emerging due to Russia’s war against Ukraine. As many tech brands and companies turn their backs on the country of Vladimir Putin, other disturbing situations are beginning to unfold.

Already here we mentioned that this conflict could also impact the chip industry. And the latest information even says that Ukraine has stopped supplying neon gas, which is essential for the production of components.

Ukraine stops selling neon gas

Two major Ukrainian suppliers, responsible for around half of the world's production of neon gas for semiconductors, suspended its operations at a time of increasing Russian attacks. Thus, as many analysts predict, this situation could have several consequences in the world of industry, since it can contribute to the worsening of the shortage of chips, in addition to favoring the increase in their price.

According to data provided by Techcet, these two suppliers are Ingas and Cryoin, which both supply between 45% and 54% of the world's semiconductor-grade neon gas. Techtcet estimates that global consumption of neon gas for chip production last year was around 540 tons. Moreover, the country of Volodymyr Zelensky supplies more than 90% of this element to the United States of America.

As we explained earlier, neon gas is a fundamental element applied to lasers used in the manufacture of chips.

Representatives of Ukrainian suppliers said their companies had suspended operations due to the destruction of their critical infrastructure.

Before the Russian attack, Ingas produced between 15,000 and 20,000 cubic meters per month for customers located in Taiwan, China, South Korea, the United States and Germany. And about 75% of the 10,000 cubic meters of neon gas is for the chip industry. Cryoin, meanwhile, produces around 10,000 to 15,000 cubic meters of gas per month. The manufacturer stopped its activity on February 24 to protect its employees.

With operations halted, businesses should be able to survive for at least three months. That's if the attacks don't reach the facilities, which would be even more dramatic.

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