Geopolitical tensions in the Middle East and the blockade of the Strait of Hormuz since early March 2026 are beginning to ripple through the global semiconductor supply chain, threatening shortages of a critical chipmaking material: photoresists.
At the center of the disruption is naphtha, a key petrochemical feedstock derived from crude oil and natural gas refining. According to The South China Morning Post, constrained shipments of naphtha have sharply reduced the production of photoresists, light-sensitive materials essential for advanced chip fabrication, particularly in extreme ultraviolet (EUV) lithography.
Industry analysts warn that the impact could be most severe for leading-edge nodes that rely on EUV technology, where tolerances are tight, and material purity is critical. Photoresists are dominated by a handful of Japanese suppliers, including JSR, Tokyo Ohka Kogyo, Shin-Etsu Chemical, and Fujifilm. Together, these firms accounted for roughly 76% of the global market in 2023, underscoring the concentration risk in upstream materials.
The supply squeeze is already raising alarms among major chipmakers. South Korea's Samsung Electronics and SK Hynix have reportedly been warned by Japanese suppliers of potential disruptions in raw material procurement. According to Reuters, semiconductor manufacturers across Asia have been building inventory buffers since late 2025 in anticipation of geopolitical instability, helping to cushion near-term production risks.
Still, the situation highlights a structural vulnerability in the semiconductor ecosystem: heavy dependence on geographically concentrated supply chains. As Bloomberg has previously reported, even minor disruptions in specialty chemicals can cascade into broader chip shortages due to the highly synchronized nature of semiconductor manufacturing.
Taiwan's TSMC may be better positioned than its peers. While its demand for advanced photoresists is substantial, the company has spent years diversifying its supplier base and maintaining strategic inventories of critical materials. Analysts say these measures should allow TSMC to manage short-term shocks, even as supply tightens.
In contrast, Chinese chipmakers appear less exposed in the near term. Much of China's semiconductor production remains focused on mature process nodes, which are less dependent on cutting-edge EUV photoresists. At the same time, Beijing has accelerated efforts to localize both technology and materials.
Article edited by Jack Wu
