Among the horrifying reports of Hurricane Helen’s damage to the southeastern United States was one for Spruce Pine, North Carolina, a town with a population of 2,194 (as of the 2020 census). The town suffered heavy damage. One resident reported that their water treatment plant had been “washed away.” Many of the town’s old brick riverside buildings are gone and there is mud everywhere.
Just north of Spruce Pine lies what could easily be considered a single point of failure in the supply chain that makes our modern high-tech world possible. There, two companies mine extremely pure quartz that (after refining) is suitable for the high-temperature crucibles (melting point 1414 °C or 2577 °F) used to melt silicon. What I’m talking about is the melting point of silicon. It is processed into silicon wafers, which are the basis of modern electronics and solar cells for solar power generation. The crucible must be made of ultra-pure quartz to avoid impurities that could destroy the silicon. The highest grade ultra-pure quartz contains less than 80 molecules of impurities per billion molecules of silicon dioxide. Silicon dioxide is the chemical formula for sand that turns into quartz in the Earth’s crust under high pressure and high temperatures.
It turns out that most of the world’s ultra-pure quartz comes from spruce pine. Exactly what percentage is kept secret in a small and secretive industry? Sibelco, the largest producer, announced that its Spruce Pine mine had ceased operations as of September 26th. Quartz also announced the suspension of operations on the same day. It is unclear how long both companies’ operations will be suspended.
The tech industry has put on a brave face, saying its operations have not been affected. This issue is not related to current operations. Many melting pots already exist. The problem will arise from the breakneck expansion of the tech industry and the need to continue increasing deliveries of silicon wafers for AI-related chips, solar cells, and Internet of Things devices, where demand is growing rapidly.
There are other sources of ultra-pure quartz, but they need to be developed. Alternatively, purification methods could be developed or expanded to make ultra-pure quartz from less pure quartz. All of this comes at a cost and could mean increased costs for the industry. However, these alternatives are not readily available. The time lag can be quite large. Discovering, permitting and constructing a mine can take years. Better purification methods may be developed quickly or may take time. Whether you do it or not, the cost can be prohibitive.
What’s really surprising is that despite warning shots that a fire at Spruce Pine halted production in 2008, the tech industry has done little to diversify its supplies. This is not an isolated issue. Tantalum, which is widely used in electronics, especially mobile phones, comes overwhelmingly from the Democratic Republic of Congo and Rwanda. Political and social unrest in these countries appears to encourage the development of alternative sources of information.
About 80 percent of the world’s gallium, a metal used in pressure sensors for semiconductors, LEDs, Blu-ray technology, mobile phones, and touch switches, comes from China. Late last year, China announced a ban on exports of processing technology for gallium and other rare earth elements, presumably to protect its position as a leading supplier to the world. China appears to be preparing to restrict exports of these elements by introducing a new reporting system for exports of these elements. It currently controls almost 90% of the world’s refining production.
None of this should come as a surprise to longtime readers who have been reading my commentary on critical mineral supplies for the past 15 years. (This recent example seems particularly pertinent.) But events revealing dangerous supply issues continue to surprise industries and governments that depend on critical minerals. , only recently realized that markets cannot solve all problems.
In fact, I think human society would be more robust if there were fewer silicon chips running it. But that is not a widely shared view. Until that happens, the high-tech industry and governments around the world are trying to keep the silicon party going in the face of new disruptions and restrictions on critical materials, whether due to geological and/or human-induced disruptions. I’ll have my hands full. policy.
From my previous post on resilience. I’ll look into the source later -BA
