Taiwan sees limited impact from Ukraine war on chip supply chain

TAIPEI, Feb 26 (Reuters) – Taiwan expects little impact from the war in Ukraine on the supply of key raw materials for semiconductors, the government said on Saturday.

Taiwan is a major chipmaker, home to the world’s largest contract chipmaker and Asia’s most valuable publicly traded company, TSMC, and key to alleviating a global semiconductor shortage that has in some cases forced car production lines to shut down.

The cabinet, following a meeting chaired by Deputy Prime Minister Shen Jong-chin, said three key raw materials for chipmaking – neon and C4F6 gases as well as palladium metal – would not have a lot of impact. Russia produces neon, C4F6 and palladium.

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Taiwanese chipmakers use little palladium, and neither Ukraine nor Russia is a major source for what the island uses, the firm said in a statement. Domestic companies also have the ability to refine and “remanufacture” palladium, so there should be no impact, he said.

For Neon and C4F6, there are already stocks on the island and the supply chains are diverse, so “the short-term impact is not significant”, the Cabinet said.

Taiwan’s energy supplies are also secure, with 145 days of oil reserves and diverse sources of supply, while for liquefied natural gas, or LNG, there are also diverse sources of supply, he added. .

The Taiwanese government announced on Friday that it would impose sanctions on Russia for its invasion of Ukraine, although it gave no details and the island’s exports to the country are minimal. Read more

On financial markets, the cabinet said the Taiwan dollar exchange rate was relatively stable but the central bank would closely monitor and take “appropriate management measures” if necessary.

The Ministry of Finance will also act to stabilize the stock market (.TWII) if necessary, the cabinet said.

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Reporting by Jeanny Kao; Written by Ben Blanchard; Editing by William Mallard and Sam Holmes

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