The price of neon gas in South Korea began to drop sharply, or it will return to the level before the Russia-Ukraine conflict

On January 3, TheElec reported that the price of neon gas, which is used in wafer fabrication or semiconductor production, has begun to drop.

The price of neon, an excimer laser gas used in lithography, rose 20-fold last year, the report said.

This is as the Russia-Ukraine conflict weighs heavily on supply chains, while customers start buying in bulk to build up inventories.

For a time, the price of neon gas for South Korean chipmakers was as high as 30 million won per 47 liters. Today, its price is 5 million won per 47 liters, but it is still three times the price before the Russia-Ukraine conflict.

The report believes that the reason for the price drop may be that South Korean chipmakers are increasingly using gas from China and local suppliers.

In addition, the fab operating rates of Samsung and SK Hynix have also decreased due to lower demand for chips, which means that the demand for neon gas is also falling.

Industry sources say chipmakers expect neon prices to return to pre-Russia-Ukraine conflict levels.