Helium shortage yet to hit Singapore’s semicon, healthcare sectors, but prolonged disruption may push costs up

COSTS, NOT OPERATIONS, AT RISK

The impact remains limited and manageable for now, but a prolonged disruption could worsen conditions, said Mr Ang of the Singapore Semiconductor Industry Association.

“If the disruption to global helium supply persists, particularly given the concentration of production in regions like Qatar, we could start to see tighter supply conditions and cost pressures emerging over time,” he said.

Alternative sources outside the Middle East exist, but whether they can fully offset a shortfall depends on the duration and severity of the disruption.

Qatar is Singapore’s main source of helium, though the US, Russia and Algeria also produce the gas, Mr Lau said.

“Qatar produces a large percentage of global supply; a total shutdown of their exports is difficult to replace instantly,” he said, adding that Singapore relies entirely on imports.

A prolonged shortage could lead to increased costs and pose long-term operational challenges, he said.

Diversified supply and existing inventories can help to cushion the impact, but a sustained disruption could tighten the market and push prices up, said Mr Ang. Rising energy prices are already feeding into manufacturing and logistics costs, and shipping costs have climbed due to higher fuel prices and route risks.

Consumers may see higher costs for electronics, cars and AI-related products, he added.

WHAT CAN BE DONE?

Manufacturing plants may need to prioritise helium use on critical products if the shortage persists, Mr Lau said. Foundries could also capture and reuse up to 90 per cent of the helium used in cooling and leak detection.

“On top of seeking alternative sources outside of Qatar, foundries may capture and reuse upwards of 90 per cent of helium used in cooling and leak detection,” he said.

Mr Ang said helium recycling systems and existing mitigation strategies can be accelerated if needed, but noted that helium has no true substitute for certain critical processes.

“These measures can only partially offset supply constraints,” he said.

He added that the industry is facing pressures rather than disruptions, with the main impact falling on costs rather than operations. The sector has also built up buffers and is more resilient than it was several years ago.

“The key risk is if the situation escalates or becomes prolonged, which could introduce more volatility in both material supply and operating costs,” Mr Ang said.