Newshub18 :Putin has also worried the technology world by curbing gas exports

With the advancement of technology around the world, the semiconductor or chip sector was advancing rapidly. But because of the Corona epidemic, it took a big hit. Russia has become a big concern of the chip makers as soon as they can overcome that push. Russia is one of the world’s largest gas suppliers. Most of the gas used in the semiconductor sector comes from Russia. Russia has now restricted its exports of rare gas. And that’s why entrepreneurs in this sector are worried, according to a report in the US media CNNRussia is the world’s largest producer of noble gas. Helium, neon, argon are colorless and odorless gases. They are called inert gases because they do not react with other elements. According to the Russian media, Russia began restricting exports of helium, neon and argon gas from the end of May. These three gases are used to make chips used in various consumer products starting from smartphones to washing machines and cars. The chip crisis has been created in the technology world for several days now.

Russia launched an attack on Ukraine on February 24. Soon after, Western nations, including the United States, imposed unprecedented sanctions on Russia. In retaliation, Russian President Vladimir Putin has imposed a series of sanctions and cuts in exports of goods and services. Moscow’s latest move is to limit exports of this rare gas. According to technology industry consultant Bain & Co., before the start of the Ukraine war, Russia and Ukraine together supplied 30 percent of the neon gas needed for the entire chip industry.
Russia announced restrictions on rare gas exports just as the semiconductor industry and its customers faced a major supply crisis.
According to LMC Automotive, a car manufacturing consultancy, less than 10 million units of cars were produced last year due to the chip crisis. However, car production was expected to increase in the second half of this year.
Justin Cox, director of global manufacturing at LMC Automotive, said the limitation of neon gas supplies was a cause for concern. However, this is not an accident for the car industry. Ever since Russia separated Crimea from Ukraine eight years ago, there have been fears of another supply disruption in the sector.

Putin has also worried the technology world by curbing gas exports

With the advancement of technology around the world, the semiconductor or chip sector was advancing rapidly. But because of the Corona epidemic, it took a big hit. Russia has become a big concern of the chip makers as soon as they can overcome that push. Russia is one of the world’s largest gas suppliers. Most of the gas used in the semiconductor sector comes from Russia. Russia has now restricted its exports of rare gas. Entrepreneurs in the sector are worried about this, according to a report in the US media CNN.

Russia is the world’s largest producer of noble gas. Helium, neon, argon are colorless and odorless gases. They are called inert gases because they do not react with other elements. According to the Russian media, Russia began restricting exports of helium, neon and argon gas from the end of May. These three gases are used to make chips used in various consumer products starting from smartphones to washing machines and cars. There has been a lot of chip crisis in the technology world over the last few days.

Russia launched an attack on Ukraine on February 24. Soon after, Western nations, including the United States, imposed unprecedented sanctions on Russia. In retaliation, Russian President Vladimir Putin has imposed a series of sanctions and cuts in exports of various goods and services. Moscow’s latest move is to limit exports of this rare gas. According to technology industry consultant Bain & Co., before the start of the Ukraine war, Russia and Ukraine together supplied 30 percent of the neon gas needed for the entire chip industry.

Neon gas is used to make semiconductors: Reuters

Russia announced restrictions on rare gas exports just as the semiconductor industry and its customers faced a major supply crisis.
According to LMC Automotive, a car manufacturing consultancy, less than 10 million units of cars were produced last year due to the chip crisis. However, car production was expected to increase in the second half of this year.
Justin Cox, director of global manufacturing at LMC Automotive, said the limitation of neon gas supplies was a cause for concern. However, this is not an accident for the car industry. Since Russia annexed Crimea from Ukraine eight years ago, there have been fears of another supply disruption in the sector.

Neon plays an important role in the production of semiconductors in a process called lithography. The gas controls the wavelength of the light produced by a laser and forms a special structure on the silicon, which basically converts it into a chip.
Jonas Sandkovist, a senior technology analyst at market research firm Techchet, said raw neon was collected as a by-product of Russian steel mills before the war. It was then sent to Ukraine for refining. These two countries have been the top producers of noble gas since the beginning of the Soviet era. The world’s superpowers used it in military and space technology.

Meanwhile, the Ukraine war has caused long-term damage to gas production capacity. Fighting between Ukrainian forces and Russian forces in various areas of Ukraine, including Mariopol and Odessa, has caused extensive damage. Various industrial factories have been damaged. This has made it difficult to export goods from that region.

Gas prices are rising

Jonas Sandkovist said gas purification capacity in the port cities of Mariupol and Odessa had been completely destroyed. However, since 2014, entrepreneurs in the semiconductor industry have begun to gradually reduce their reliance on Russia and Ukraine. These efforts have intensified since the invasion of Ukraine.
Peter Hanbury, an associate at Bain & Company, said Russia and Ukraine relied on 80 to 90 percent for neon gas. But since 2014, the manufacturers have reduced it to one third.
It is unknown at this time what he will do after leaving the post. Hanbari said that so far the global chip-making process has not been hampered by the war. Its effects may not be seen very soon.

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However, if chip makers had to reduce their dependence on Russian gas and find other sources, their costs would be much higher. Sandcovist said it is difficult to determine the price of noble gas, including neon. Because, these are provided in long term contract. However, according to Techchat, the price of neon gas has already increased fivefold. Its price has gone up since the beginning of this year. It doesn’t seem to be slowing down anytime soon. The impact of the Ukraine war must be felt in any new agreement.
South Korean chip maker Samsung is already in trouble. Because the country has to import gas. The country also has a shortage of large gas companies such as the United States, Europe or Japan.

According to research firm Counterpoint Research, Samsung surpassed Intel in the US in chip exports last year. The price of neon gas is rising, according to Micron Technology, another major chip maker in the world. But they have the gas to make the chip in the next few months.

China will benefit

According to US media CNN, China will enjoy the benefits of restricting Russia’s inert gas exports to non-aligned countries. China has invested heavily in the semiconductor industry since 2015. This includes equipment such as separating inert gas from industrial products. China is now an exporter of this gas.
Jonas Sandkovist, a senior technology analyst at market research firm Techchet, said everyone would now turn to China for inert gas due to the Ukraine war. China will now make a profit by selling their gas at a higher price