Hurricane Helene, the deadliest storm since Hurricane Katrina in 2005, has caused significant disruptions in the semiconductor supply chain, particularly affecting quartz mining in Spruce Pine, North Carolina. This region is crucial as it produces approximately 90% of the world's ultra-pure quartz, which is essential for semiconductor manufacturing. The flooding from the hurricane has severely impacted operations at The Quartz Corporation, which is unable to provide a timeline for resuming production. However, the company has expressed confidence in avoiding long-term supply disruptions despite the current challenges. [da6da4ad]
The flooding has also led to concerns about the availability of IV fluids in hospitals across the United States. Baxter International, a major supplier of IV fluid bags, has had to close its facility in Marion, North Carolina, due to the hurricane's impact. This facility supplies about 60% of the nation’s IV fluids, and as a result, hospitals like Mass General Brigham are expecting only 40% of their usual supply. CEO José (Joe) E. Almeida has stated that remediation efforts are underway to address the situation, while competitors B. Braun and ICU Medical are increasing production to help mitigate the shortages. This crisis mirrors the challenges faced by hospitals following Hurricane Maria in 2017, highlighting the fragility of healthcare supply chains during natural disasters. [7287bc33]
In the semiconductor sector, Fuso Chemical, a key supplier of silica used in chipmaking, is also feeling the strain. The Osaka-based company, which holds a 90% share of the global silica market, has opted to take on more debt rather than raise prices, fearing it could jeopardize relationships with major clients like Taiwan Semiconductor Manufacturing Co. and Intel Corp. The company borrowed ¥20 billion ($136 million) from banks in April to fund its silica capacity ramp-up, as its cash flow deteriorates amidst rising demand. [7c9b189c]
Experts predict that the flooding and damaged transport infrastructure will lead to short-term price increases in the semiconductor industry. Ed Conway has suggested that it may take months for operations to return to normal, raising concerns about potential chip shortages and further economic impact. The federal government is expected to prioritize recovery efforts due to the strategic importance of quartz mining in the semiconductor supply chain. [93d5c7a9] [ffe797bd]