Huatai Securities: Electronics Gas Boom May Accelerate Amid Improving Supply-Demand Dynamics

Huatai Securities points out that electronic gases are key raw materials for chips, ranking second only to silicon wafers in wafer manufacturing costs. As chips develop toward new storage technologies, advanced processes, and advanced packaging, according to TECHCET, the global electronic gas market is expected to grow by 8% year-over-year to $6.8 billion by 2026. Huatai Securities believes that with the expansion of storage factories and wafer fabs in China, and given supply constraints of gases like helium due to geopolitical conflicts in the Middle East, the industry’s prosperity in China is expected to accelerate by 2026. In 2024, Chinese listed companies hold a 40% share of the domestic electronic gas market. With increasing demands for independent control and the catalysis of anti-dumping measures, the localization rate is expected to rise, allowing leading Chinese electronic gas companies to benefit fully.

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Huatai | Chemicals: Improving Supply and Demand May Accelerate Electronic Gas Industry Prosperity

Electronic gases are critical raw materials for chips, ranking second only to silicon wafers in wafer manufacturing costs. As chips evolve toward new storage technologies, advanced processes, and advanced packaging, TECHCET forecasts the global electronic gas market will grow by 8% year-over-year to $6.8 billion by 2026. We believe that with the expansion of storage and wafer manufacturing plants in China, and supply constraints of gases like helium caused by geopolitical conflicts in the Middle East, industry prosperity in China is expected to accelerate by 2026. In 2024, Chinese listed companies account for 40% of the domestic electronic gas market. With rising demands for self-control and the influence of anti-dumping measures, the localization rate is expected to increase, enabling leading Chinese electronic gas companies to benefit fully.

Core Views

Middle East conflicts impact global helium supply, increasing stockpiling overseas may drive up both volume and prices of helium

According to USGS, in 2024, Qatar’s helium reserves and production are 10.1 billion and 0.73 billion cubic meters, respectively, accounting for 19% and 39% of the global total. Supply has been constrained since March due to Middle Eastern tensions. Business Analytiq reports that in March, helium prices in Northeast Asia rose 13% month-over-month to $147 per kg. With the rapid development of semiconductors and aerospace industries in recent years, demand for helium has continued to grow, with Asia-Pacific being the largest demand market, including China, South Korea, and Japan. In 2025, 66% of China’s imported helium comes from Qatar. As global helium supply tightens, semiconductor companies in China and Japan may accelerate stockpiling of helium and other electronic gases, potentially increasing sales volume and prices. Chinese helium companies could benefit, along with Russian gas companies, and the industry’s overall prosperity is expected to improve.

Electronic gases are essential for chip manufacturing, and new demands such as storage are expected to boost industry growth

Electronic gases include bulk electronic gases and specialty electronic gases used in integrated circuits and other industries. According to SEMI, in 2020, specialty gases accounted for 13% of wafer manufacturing costs, second only to silicon wafers. As chips move toward 3D NAND, HBM multi-layer structures, advanced processes, and packaging, demand for electronic gases is expected to grow steadily. TECHCET projects that in 2025, the global market for specialty and bulk electronic gases will reach $4.64 billion and $1.67 billion, respectively, with year-over-year growth of 5% and 4%. By 2026, these markets may grow by 9% and 7% to $5.04 billion and $1.78 billion, and by 2029, they could reach $5.71 billion and $1.96 billion, with CAGR from 2025-2029 of 5% and 4%. The surge in AI-driven storage chip demand in 2026 is expected to accelerate capital expenditure by storage chip companies, further boosting the electronic gas market.

Expansion of storage and wafer factories supports domestic demand; advanced processes may increase value

China’s storage and wafer manufacturing capacity expansion is expected to sustain demand for electronic gases. According to Zhuochuang Information, in 2024, China’s market size for specialty and bulk electronic gases was 9.8 billion and 9.7 billion yuan, respectively. By 2026, the market is projected to grow 7% year-over-year to 22.2 billion yuan, reaching 29.8 billion yuan by 2030, with a CAGR of 7% from 2026-2029. As semiconductors develop toward new storage technologies and advanced processes, multi-layer structures and new deposition and etching techniques will increase the consumption of electronic gases, especially higher-value gases. SK Hynix’s environmental impact report indicates that process upgrades will lead to increased unit consumption of gases like nitrogen trifluoride, silane, hexafluorobutadiene, and lithography gases.

Localization of China’s electronic gases continues to rise, with further acceleration expected in 2026

Global electronic gases are mainly dominated by foreign companies such as Air Liquide, Linde, and Air Products. Chinese companies include Guanggang Gas and JinHong Gas for bulk gases, and China Shipbuilding Specialty Gases and Huate Gas for specialty gases. In recent years, domestic products have improved in quality, and policies favoring self-control have increased localization. According to China Business Industry Research Institute, the localization rate of specialty electronic gases in China is expected to rise from 9% in 2018 to 25% in 2025. Wind data shows that in 2024, Chinese listed companies held a 40% share of the domestic electronic gas market. In January 2026, the Ministry of Commerce initiated anti-dumping investigations into imports of dichlorosilane from Japan, a key material used in chip manufacturing. China mainly relies on imports, primarily from Japan and South Korea, with demand steadily increasing. We believe that as self-control requirements strengthen, domestic companies will deepen relationships with clients, and this anti-dumping case may further accelerate localization, allowing leading Chinese electronic gas firms to benefit fully.

Risk warnings: Downstream demand falls short of expectations; expansion of new projects underperforms; raw material prices fluctuate significantly.

(Source: Jiemian News)