Prices Soar by 200% and Supplies at Risk: Here's the New Semiconductor Problem
The global supply chain for tungsten and tungsten hexafluoride (WF₆) is undergoing a phase of significant structural tension, fueled by export restrictions and increasing international competition for critical raw materials.
WF₆ is an essential precursor gas in the production of advanced semiconductors, used for tungsten film deposition on wafers. This material enables the creation of conductive connections within chips and is particularly important in 3D NAND, DRAM, and logic chips architectures. In 3D NAND with over 200 layers, the material is used in repeated deposition cycles, significantly increasing industrial demand.
On the pricing front, the market recorded a strong increase in April 2026, with WF₆ reaching approximately $149.79 per kilogram, marking a 28.33% year-on-year increase and over 200% month-on-month. High-purity variants have also shown marked increases, with variations exceeding 190-230% depending on the quality grade.
The pressure on the supply chain is closely linked to China's export policies, which holds about 80% of global tungsten production. China is zeroing out shipments to Japan mainly due to a diplomatic and geopolitical dispute related to Taiwan, coupled with a stringent control strategy over critical raw materials.
The imposed restrictions have had a direct impact on Japanese companies like Kanto Denka and Central Glass, which rely heavily on such supplies for WF₆ production destined for leading semiconductor manufacturers like TSMC, SK Hynix, and Samsung. Shipments of tungsten from China to Japan have reportedly been virtually zeroed out since February, a situation that has led to the gradual erosion of industrial stocks.
Kanto Denka and Central Glass have notified customers that they will definitively suspend WF₆ production starting in July. Considering that together they represent about 2,000-2,200 tons out of a global production estimated between 8,000 and 9,000 tons annually, their potential exit from the market would have a significant impact on the global supply chain balance.
Alongside these restrictions, a new dynamic related to recycled tungsten is developing. US shipments to Japan of recycled materials from tungsten carbide scrap reached approximately 590,000 kilograms in just the first quarter of 2026, a volume 24 times greater than all of 2025.
Overall, US exports of recycled tungsten have tripled year-on-year, reaching 1.72 million kilograms in the first quarter, nearing the 2.2 million exported in all of 2025. About 60% of these flows are destined for Asian markets excluding China, while 30% goes to Europe.
However, this segment is also becoming increasingly competitive: the price of recycled tungsten in the US reached approximately $167.50 per pound in May 2026, sharply rising from less than $40 the previous year.
The price increase, however, is not solely related to Japanese demand. China is also increasing its purchases of recycled tungsten from the US, despite restrictions introduced in previous years on scrap imports for environmental reasons. These limitations have been gradually relaxed as raw material availability has become critical.
So what will happen next?
South Korean companies have activated immediate emergency plans, accelerating certification processes for materials that would normally take over 18 months with local entities like SK Specialty and Foosung, which are not involved in the spat between Beijing and Tokyo. Korean suppliers also depend on Chinese raw materials, but currently South Korea benefits from a political exemption from Beijing, unlike Japan.
Global semiconductor customers (including Taiwanese TSMC) are turning and will increasingly turn to Chinese chemical companies, which have made enormous strides in self-sufficiency and fluorinated gas quality in recent years. Zhongshuang Special Gas possesses the world’s largest WF₆ production capacity (2,000 tons/year by the end of 2025) with 6N purity and has already entered the supply chain for TSMC, Samsung, and SK Hynix.
In the short and medium term, therefore, customers of Japanese companies will have to absorb significantly higher costs and turn to Korean and Chinese manufacturers to avoid stalling chip production lines. Analysts expect that the imbalance phase may persist at least until 2027.