Hurricane Helene threatens global semiconductor supply chain

Posted: October 8, 2024

By some estimations, nearly every cell phone and computer chip contains silicon derived from quartz from the tiny town of Spruce Pine in North Carolina. But as of October 4, Hurricane Helene has shut down production at the mines the global semiconductor industry depends on. Continued disruption to the mines could have far-reaching economic consequences.

High-purity quartz threatened by Hurricane Helene

There are just a few places in the world with quartz deposits of high enough purity to be used in the manufacture of semiconductors—and Spruce Pine has both the largest quantity and highest purity. The mines there shut down on September 26 in preparation for Hurricane Helene and have remained shuttered because of hurricane damage as of October 4.

Fortunately, an initial assessment by one mine operator, the Belgian company SIBELCO, indicated only “minor damage” to the mines themselves. But, as of October 4, power to the mines was still out and the surrounding area has extensive damage to both roads and rail lines. A second mine operator, The Quartz Corp said in a statement on October 2 that it did not know when it would be able to resume operations.

Hurricane Helene inundated the town of just over 2000 people with over two feet of rain, causing the nearby North Toe River to flood the downtown with about ten feet of water. Power, water and cellular services all went down and roads washed out. It’s taken some residents days to clear away fallen trees that were impeding travel. Fortunately, all mine workers are safe.

Semiconductors depend on high-purity quartz

The high-quality quartz from Spruce Pine is an irreplaceable material for semiconductor manufacturing. Silicon transistors power the microchips in everything from cell phones, airplanes, pacemakers and data centers.

Vince Beiser, author of The World in a Grain, told the AP:

“To make silicon chips, you need to first melt down a highly-purified material called polysilicon. That can only be done in crucibles that are themselves made of a material so pure it will not react chemically with the polysilicon and is also able to withstand enormous heat…The best material for those crucibles is ultra-pure quartz. Spruce Pine is the source of the purest natural quartz ever found on Earth.”

In fact, Spruce Pine supplies about 70% of the naturally occurring high-purity quartz used in computing applications.

Lita Shon-Roy, the president and CEO of market research firm TECHCET, told NPR it’s amazing that the industry relies so heavily on Spruce Pine:

“Every time I’ve asked in the last two decades, the question always comes back, ‘Well, where else are we supposed to get it?’”

She continued, “I haven’t heard of any viable sources yet to replace what’s in North Carolina.”

Besides going into crucibles used to melt polysilicon, high-purity quartz also goes into manufacturing components of microchips themselves. And the Chinese photovoltaic (PV) industry also relies on it to produce solar panels.

Supply chain impact of Spruce Pine hurricane damage

Just how much of a supply-chain disruption the mine shut-downs will cause depends on a variety of factors, including how soon power and rail transport can be restored to the region. Both SIBELCO and The Quartz Corp issued statements emphasizing their commitments to helping rehabilitate their community and minimizing impacts on supply chains:

In an October 3 statement, SIBELCO wrote:

“We are actively collaborating with the community, local authorities and businesses to support recovery activities. Our efforts have included road clearing and repairs, the provision of temporarily power supply to organizations in greatest need, the supply of fuel and working with the cities of Spruce Pine and Bakersville to establish temporary water supply systems for residents.  

…

Our final product stock has not been impacted. We are working closely with our customers to assess their needs and plan the restart of product shipments as soon as we can. 

Our thoughts are with all those affected by Hurricane Helene. We extend our gratitude to our employees, the first responders, and the construction crews who are working tirelessly on recovery activities in the region.”

The Quartz Corp wrote:

“…we remain confident of our ability to avoid any supply disruption for our High Purity Quartz customers. We operate a long supply chain and like many we added more focus on our resilience planning post-Covid.

As a result, we have established strong levels of feed stock in Norway to supply our purification operations. Coupled with safety stocks of finished products and those that exist at different levels throughout the supply chain, we do not anticipate any critical situation for our downstream industries in the short or medium term.

For now, our focus is on reconstruction and support to our community in Mitchell County who has been so deeply hurt.”

At nearly 450 km (280 mi) from the Atlantic Ocean, in the Appalachian Mountains, Spruce Pine seems an unlikely place to be in danger from hurricanes. But, climate change is causing dramatic increases in rainfall and flooding throughout the U.S. Bill Hunt, an engineer and professor at North Carolina State University, told NPR:

“It’s not isolated to Hurricane Helene and it’s not isolated to North Carolina. It’s no longer that if you’re on the river, it’s a problem. You may be miles away and have a problem.”

As our climate changes, unusual and unprecedented weather events will become more common, and may affect industries in ways they don’t expect. Increasingly, communities are turning to data to prepare for and respond to such events. North Carolina is developing its Flood Resiliency Blueprint, which uses advanced computer modeling to help municipalities decide how to allocate funding to prevent and respond to flood risks. Since many locations in the U.S. have obsolete weather data, the National Oceanic and Atmospheric Administration (NOAA) is compiling updated precipitation estimates that take climate change into account—a project known as Atlas 15. It’s hard to change the weather, but tools like these can help towns, cities and businesses remain resilient in the face of such unprecedented events.