The conflict between Russia and Ukraine may increase the cost of component materials

The US government has warned domestic chipmakers of a potential material supply crisis that would increase its cost if the conflict between Russia and Ukraine intensifies. This information comes from Reuters, which cites people familiar with the matter. This warning is based on concerns about the possible conflict between Russia and Ukraine, so that if Russia makes military advances, it is almost certain that there will be impacts on Ukraine's industries along with sanctions on Russia by the United States, which will aggravate supply problems.

Reuters reported the dependence of the US chip manufacturing industry on materials from Russia and Ukraine. One of the examples given by Reuters was that of the market research group Techcet. Supplies 90% of semiconductor-grade neon, important for maintaining machines in US foundries; come from Ukraine, and that 35% of US palladium is sourced from Russia, along with C4F6, helium and scandium.

A conflict with great economic consequences

An unnamed source working in the chip manufacturing sector told Reuters that already supply chains are being reviewed arriving in or around the potential conflict zone. He also noted that alternative sources of essential gases used in chip manufacturing, including neon, are being reevaluated.

Said shortage of materials as a result of the conflict between Russia and Ukraine would not stop the manufacture of chips, but it would raise prices due to the increase in the cost of manufacturing. And it is that not only the final price of the product will rise, but also the materials needed for the assembly lines. Much of the machinery needed to mass-produce delicate components requires rare gases or minerals that are found in Russia or the Ukraine, or need to pass through them on land transport.

Source: Tom's Hardware