The devastation in a small North Carolina down from Hurricane Helene may cause unexpected issues to the semiconductor production industry, as nearly all of the world’s supply of a necessary mineral comes from that area.
The “purest form” of quartz is mined in Spruce Pine, which has a population of just 2,600 people, according to CNBC.
With the town’s electricity and running water still out more than a week after the storm and raging flood waters ripped through the foothills of the Blue Ridge Mountains, the $600 billion global semiconductor industry may be crippled, the outlet reported.
Before Helene, companies like Sibelco and The Quartz Corp. extracted the high-quality quartz before refining it and shipping it to global manufacturing facilities, primarily in China and other Asian countries.
Those operations have all been placed on pause as the Appalachian community grapples with getting basic necessities such as food and water.
Neither of the major companies has released a timeline on when they could possibly resume mining.
“Hurricane Helene has significantly impacted North Carolina, USA, and the Spruce Pine community has been hit particularly hard,” Sibelco said in a September 30 statement, before saying that “many people,” including their own employees and families, are facing “displacement.”
“We have confirmed the safety of most employees and are working diligently to contact those still unreachable due to ongoing power outages and communication challenges,” the company continued. “As of September 26th, we have temporarily halted operations at the Spruce Pine facilities in response to these challenges.”
“The Spruce Pine community has been hit particularly hard,” Sibelco said in a statement on Sept. 30. “We have temporarily halted operations at the Spruce Pine facilities in response to these challenges.”
In a similar October 1 statement, the Quartz Corp announced that “operations at our facilities were stopped on September 26th in preparation of the event and we have no visibility on when they will restart.”
“This is second order of priority. Our top priority remains the health and safety of our employees and their families,” company officials added, noting that they have successfully made contact with all of their Spruce Pine workers.
TECHCET, a market research firm focused on the supply chains for semiconductor materials, has noted the gravity of what this could mean for the industry.
“This is the only plant in the world right now that serves the semiconductor industry in its entirety,” CEO Lita Shon-Roy told CNBC of Spruce Pine. “If something were to happen to these mines, it can put the entire industry on its ear, period. There’s no other capability.”
While the firm estimated that it would take four to six weeks for the mines to become operational again, Shon-Roy noted that it is dependent on how the surrounding community fares at re-opening the roads and other local infrastructure.
“Roads are gone,” said Spencer Bost, the executive director of Downtown Spruce Pine.
In some areas of town, he said “the roads just don’t exist anymore.”
Shon-Roy added that she hopes that the already stockpiled inventory of quartz could provide a two or three-month cushion for the industry to recover from the natural disaster.
“A month’s delay is not bad,” the industry expert said. “Two months is getting difficult. Three months becomes a real problem.”
The Blaze’s Andrew Chapados warned of China taking over the entire semiconductor industry.
“For semiconductors, China has the second-highest share of sales in the world. When supply chains in the United States are disrupted, at best, the market turns to the Chinese,” he wrote in a Friday article. “If that option is not available, competitors in Europe may be able to pick up the slack, but at nowhere near as low a price.”
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