https://safirsoft.com Low silicon production in China leads to higher wafer production costs

Why it matters: Silicon makes up about 28 percent of the Earth's crust by weight, making it the second most abundant substance on Earth. However, the ongoing power shortage in China has had a significant impact on the production of high-purity silicon, driving up prices within two months. This exacerbates other negative effects of shortages of materials and components and is similarly expected to lead to higher prices for various types of consumer and industrial products.

Over the past few months, we've seen a rapid decline in the technology supply chain, which began with a shortage of chips and culminated with soaring prices for rare earth metals and various passive electronic components. Last month, chip and electronics manufacturers complained of a severe shortage of skilled workers, which threatens to prolong the status quo until 2022, a sentiment common to nearly all industry players.

If "enough" isn't, there's a new problem for chip makers - silicon, which is critical to building everything from display driver chips and microcontrollers to chip drivers for machine learning. It is now three times more expensive than in two months.

https://safirsoft.com Declining silicon production in China increases the cost of chip production. But China has been waiting for more of energy demand in the winter months to reduce air pollution before the upcoming Winter Olympics and increase coal and natural gas reserves.</p> <p> Production of ultra-pure silicon has fallen sharply as a result of energy restrictions., to the extent that some companies have been forced out China is suspending operations until it can provide a stable source, and glass, solar panels and automakers are expected to see ripple effects in the coming months with manufacturers of silicon-based products hitting their trade, too.</p> <p> <img src =

Industry owners believe that silicon prices will remain high at least until mid-2022, when production will rise again. Meanwhile, some manufacturers are able to absorb the shock, while many are likely to raise prices for end customers. Even Apple, which has moved relatively easily on most of the current supply chain problems, is expected to feel the pressure in the coming months.

Read also: Next Generation EUML Machine ASML Rent Morse New Life Law

Overall, the price of everything that has a chip seems to be still high for a while. Both TSMC and Samsung raised chip prices this year to aid their ongoing efforts to increase their production capacity for advanced process nodes, which threaten to send CPU and GPU prices into the stratosphere. And it's not that PC gaming is becoming more popular in the midst of the pandemic, which means you can easily transfer a good deal to a gaming monitor instead of a gaming PC.

Low silicon production in China leads to higher wafer production costs
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