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Ukraine supplies 50% of refined neon worldwide

By early 2022, Ukraine was estimated to supply 50% of the world’s refined neon, according to a report by the United States Trade Representation (USTR).

Neon, specifically ultra-high purity grade (purity greater than 99.99%), is commonly used as a carrier gas for lasers used in semiconductor production.

The Ukrainian neon industry is largely supplied with raw neon gas inputs from Russian steel production operations, which extract neon as a by-product.

Also, according to USTR, the semiconductor industry accounts for up to 90% of neon gas laser demand.

From the USTR’s point of view, the ongoing conflict in Ukraine raises fears about the security of that supply, further exacerbating the global semiconductor shortage, which had begun to recover from the Covid-19 pandemic-related shortage.

Ukraine

During 2021, the semiconductor industry experienced widespread shortages of substrates and other components and available foundry fabrication capacity, and Intel expects those shortages to continue into 2022.

This shortage has limited Intel‘s ability to supply customer demand in some of its businesses, such as its PSG products, and has negatively affected customer demand for its products, including in its CCG and DCG businesses, as some customers have been unable to procure sufficient quantities of third-party components used in conjunction with their products to produce finished systems. It is difficult to predict the future impact of this shortage.

To obtain future supply of certain materials and components, especially substrates, and third-party foundry manufacturing capacity, Intel has entered into agreements with certain of its suppliers involving long-term purchase commitments and/or large upfront payments.

These arrangements may continue to be inadequate to meet its needs, or its suppliers may fail to deliver committed volumes on time or at all, or its financial condition may deteriorate.

If future customer demand over the horizon of these arrangements is lower than its expectations, Intel could have excess or obsolete inventory, unnecessary capacity and increased costs, and its prepayments may not be fully utilized and, in some cases, may not be fully recoverable.

 

Redacción Opportimes

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