Fears over computer chip shortage as a result of war in Ukraine

A major ingredient for the production of any computer chip is neon, with lasers requiring this critical component during the manufacturing process. Ukraine’s two biggest suppliers of neon support around half of global computer chip manufacturing. The result of Russia’s attacks have left these operations in limbo, with serious doubts over their future.

In 2020 the total global demand for neon reached a staggering 540 tonnes – with two Ukrainian companies providing supply to 45-54% of that volume.

Experts are attempting to estimate chip makers current stockpiles, with a prolonged conflict having serious impacts on the supply chain. The key turning point for many is the end of April, where the true extent of the conflict will begin to seriously impact end-customers. Both companies (Ingas and Cryoin) have already reported they will fall well short of their production targets by the end of March. Citing the ability to keep employees safe as well as their ability to access raw materials as the major reasons.

With such uncertainty surrounding the electronics industry and a likelihood of price rises, we urge customers to purchase products for their operations now. Contact our team to discuss your operations needs now.