The Russia-Ukraine conflict has caused a shortage of neon gas supply. Will the semiconductor industry be "choked"?

Ukraine is currently the country with the largest neon production. The war between Russia and Ukraine has also affected the global semiconductor industry. What is neon? How effective is it? Can it be produced domestically? Let's take a look.

Compiled by New Media Editor Lai Tianying

The intensification of the conflict between Russia and Ukraine has caused panic in the entire industry as Ukraine accounts for 70% of the global supply of neon (Ne).

According to Reuters, Dutch lithography giant ASML is looking for other sources of neon gas to prevent the Russian-Ukrainian conflict from disrupting its supply. In response, an ASML spokesman said that about 20% of the neon gas used by the company comes from Ukraine.

Neon gas, which emits a deep red light in a vacuum tube, is dazzling and unforgettable to those who have seen it. In addition to being gorgeous, this "blunt gas" that makes neon lights emit red light - neon gas - also plays an important role in transportation, electronics industry, aviation and navigation, and scientific research.

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Neon

Lighting up the darkness of the city

When night falls, beautiful neon lights can be seen everywhere in the city, shining brightly. But what you don’t know is that these colorful lights are all emitted by the “blunt gas” family when they are powered on. They are colorless and odorless at room temperature, and are not easy to react chemically with other substances. The content in the air is very low.

Scientists spent a lot of effort to discover these lazy guys. One of them is the "dull gas" that makes neon lights glow red - neon gas, which is extracted from liquid air at more than 200 degrees below zero.

Inspired by a colleague named Travers, William Ramsay, a professor of chemistry in London, England, turned the inert gas in the air into liquid gas, and then fractionated it to obtain an unknown element, which he named Neon, or Ne for short. Later, Chinese scientists introduced this element into Western chemistry and translated it into "neon".

▲Neon glows when electricity is applied (Source: Tadpole Musical Notation)

Professor Ramsay did not expect that the luminous properties of neon gas when electrified would determine that it would play an extremely important role in the decoration of urban night scenes. When making neon lights, filling a glass tube with neon gas can make a deep red neon lamp, filling it with argon gas can make a light blue argon lamp, and filling it with helium gas can make an orange helium lamp. Mixing neon, argon, helium and other gases in different proportions and then putting them into a sealed tube will make a colorful neon lamp. For a long time, people believed that neon gas "lit" the neon lights.

In addition to neon lights, neon also plays an important role in transportation, electronics, aviation, navigation, scientific research and other fields. In addition, neon is also a key material for exposure and etching processes in the semiconductor industry. In the production process of microelectronics and optoelectronic devices, from chip production to the final device packaging, almost every step and every link is inseparable from it.

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Various semiconductor raw materials may be impacted in the short term

As a major supplier of semiconductor raw material gases in the world, Ukraine is a supplier of gases such as neon, argon, krypton, and xenon, among which neon gas is the global market leader.

In the industry's view, if the Russia-Ukraine conflict escalates further, it is likely to cause a shortage of supply of related rare gases.

A report released by Techcet, a US market research company, in early February pointed out that neon gas is crucial to semiconductor manufacturing and is a by-product of Russia's steel manufacturing industry, while Ukrainian companies are responsible for the purification of neon gas.

The study found that Ukraine mainly produces neon, krypton and xenon, which are key materials for exposure and etching processes in the semiconductor industry. According to data provided by TrendForce to the Global Times, Ukraine supplies 70% of the world's demand for neon, 40% of krypton and 30% of xenon.

Analysts at Everbright Securities believe that neon is indispensable in the production of microelectronics and optoelectronic devices. Therefore, it is called the "food" and "source" of semiconductor materials. The cost of these "inert gases" (especially neon) accounts for 5%-6% of the total cost of IC materials, which is not a large proportion, but it largely determines the performance of semiconductor devices.

Ren Lu, a senior analyst of the Chinese specialty gas market, said in an interview with the media that neon, xenon and krypton are indispensable process gases in the semiconductor manufacturing industry, and the stability of the supply chain is extremely important because it will seriously affect the continuity of production. He said that at present, Ukraine is the world's major producer of neon. Due to the escalating situation between Russia and Ukraine, the stability of the neon supply chain has inevitably caused panic in the entire industry.

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my country has achieved technological breakthroughs in a variety of gases

Under the influence of the situation between Russia and Ukraine, the price of neon is rising strongly. According to data from market agency iFind, the current price of neon in the domestic market is 1,650 yuan/cubic meter, a 65% increase from the beginning of the year and four times the low point in October 2021. The last serious neon shortage in the semiconductor industry was also related to the situation between Russia and Ukraine. According to data from the U.S. International Trade Commission (ITC), during the tense situation on the Crimean Peninsula in 2014, the price of neon once rose by 600%. On the other hand, the year-to-date increase in inert gases such as krypton and xenon is also considerable. As of February 23, the price of krypton has increased by 39.24% year-to-date, and the price of xenon has increased by 27.27% year-to-date.

▲Domestic market price of neon gas (Source: Guancha.com)

From a global perspective, in cutting-edge fields such as extremely large-scale integrated circuits and new display panels, the specialty gas market is mainly monopolized by foreign gas companies such as France's Air Liquide Group, the United States' Linde Group, the United States' Air Products and Chemicals Group, the United States' Praxair Group, Japan's Taiyo Nippon Sanso Group, and Japan's Showa Denko.

▲Distribution of China’s specialty gas market share (Source: Yidu Data)

However, my country has also achieved technological breakthroughs in many products. Walter Gas, listed on the Science and Technology Innovation Board, disclosed that it has become the first domestic gas company to break the import restrictions on high-purity hexafluoroethane, high-purity trifluoromethane, high-purity octafluoropropane, high-purity carbon dioxide, high-purity carbon monoxide, high-purity nitric oxide, and photolithography gas (Ar/F/Ne mixed gas, Kr/Ne mixed gas, Ar/Ne mixed gas, Kr/F/Ne mixed gas), and has taken the lead in achieving import substitution for nearly 20 products.

Ren Lu, a senior analyst of the Chinese specialty gas market, also said that although neon, krypton and xenon are necessary for the production of the semiconductor industry, their absolute usage is not high. As by-products of the steel industry, the global market size is not very large. "China is a major steel country in the world. The purification technology of these rare gases has achieved breakthroughs, and the production process is relatively mature. It is no longer a technology that can 'choke China'."

(Information compiled from: China Business Network, Sina Finance, Sina Technology, Tadpole Music, China News Network, Sohu.com, China Youth Network, Aerospace Information Port, Observer.com, Global TMT, Sina Finance, etc.)

Produced by: Science Central Kitchen

Produced by: Beijing Science and Technology News | Beijing Science and Technology Media

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