Helium spot prices surge over 50%! Industrial gas concept stocks rise in the afternoon, Kaimeite Gas hits the daily limit.

(Source: Finance News)

          With the expansion of storage and wafer manufacturing plants in China, coupled with limited gas supply due to geopolitical conflicts in the Middle East, the electronic gas industry in China is expected to accelerate in prosperity by 2026.            

On March 27, industrial gas stocks surged in the afternoon, with KMT Gas (002549.SZ) reaching its upper limit, while Jin Hong Gas (688106.SH), Hangyang Co. (002430.SZ), Guanggang Gas (688548.SH), China Shipbuilding Special Gas (688146.SH), and Huate Gas (688268.SH) also saw gains.

According to industry insiders, the spot price of helium has skyrocketed, increasing by over 50%. Procurement departments of semiconductor manufacturers such as Samsung Electronics, SK Hynix, and Eastern High-Tech are checking the supply status and price fluctuations of critical materials daily to prevent production interruptions.

In early March, the geopolitical situation escalated, with LNG facilities in Ras Laffan Industrial City, Qatar, being attacked, leading to a halt in production at one of the world’s largest LNG plants, increasing uncertainties on the supply side. Helium is a key byproduct extracted during the natural gas liquefaction process. Qatar’s gas fields have a high helium content, making it the second-largest helium producer. By 2025, its helium production will account for over one-third of the world’s total output.

The damage caused by the attack is expected to be long-term. Previously, the CEO of Qatar Energy, Saad Sherida Al-Kaabi, publicly stated that repairs are expected to disrupt approximately 12.8 million tons of LNG capacity annually, potentially lasting three to five years. This means that the supply of associated helium may face a long-term rigid gap. As one of the most readily available inert gases, helium is widely used in semiconductor manufacturing processes such as photolithography, etching, ion implantation, and chemical vapor deposition due to its stable chemical properties, serving as a protective gas, carrier gas, and purge gas. In wafer manufacturing costs, electronic gases are the second-largest raw material/supporting material cost item after silicon wafers, accounting for about 13%-15%.

As the situation in the Middle East becomes increasingly complex, wafer manufacturers are beginning to focus on and anticipate supply chain bottlenecks and price transmission. Reports indicate that South Korean chip giants like Samsung Electronics and SK Hynix are urgently checking their helium inventory status. In the Chinese market, there are numerous mature process semiconductor manufacturing companies with strong demand for helium. Related companies in the A-share market have been affected to some extent.

Northeast Securities recently pointed out in a research report that they remain optimistic about the long-term allocation value of the electronic gas sector under the resonance of supply and demand. On the demand side, the industry market scale is expected to enter a nonlinear expansion phase; on the supply side, changes in the external environment are forcing downstream manufacturers to accelerate supply chain restructuring. Huatai Securities also noted that with the expansion of storage and wafer manufacturing plants in China, along with limited gas supply due to geopolitical conflicts in the Middle East, the electronic gas industry in China is expected to accelerate in prosperity by 2026.

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