Helium shortage, prices double, Middle Eastern conflict burns high-tech

Ask AI · How Chinese Companies Are Responding to the Helium Supply Crisis

Jiemian News Intern Reporter | Peng Tianmei

“It’s not a price issue now; there’s simply no stock.” On April 1st, a helium supplier in Jiangsu told Jiemian News.

This threat comes from a colorless, odorless resource that is extremely scarce on Earth—helium. As a byproduct of natural gas, helium is an indispensable raw material in semiconductor etching cooling, superconducting magnets, aerospace fuel washing, nuclear magnetic resonance imaging, low-temperature superconductivity, and defense military industries, earning it the nickname “Golden Gas.”

With Qatar’s production line halted, helium supply has fallen into shortage.

According to the supplier, due to resource concerns triggered by Middle Eastern tensions, the domestic helium market has experienced a clear panic buying. “Prices are fluctuating wildly; currently around 760 yuan (per cubic meter), which is double the usual.”

The surge in prices directly raises the production costs for downstream companies. The supplier said that although demand remains rigid, the excessively high costs have caused some gas industry clients to feel “immense pressure,” leading to restrictions in some production processes. The shortage is mainly concentrated in a single type of helium.

Average price in major markets nationwide for helium (price monitoring on the 7th) Image source: Zhuochuang Information

The uniqueness of the helium crisis lies in how difficult it is to store. Liquid helium must be stored in vacuum-insulated containers close to absolute zero.

Phil Kornbluth, a senior executive in the natural gas industry and a helium industry consultant, told the media that about 200 dedicated helium containers are currently stranded in the Strait of Hormuz due to the conflict.

These individual containers, costing up to millions of dollars each, are not indefinitely cooled. Their internal nitrogen insulation layers typically last only 35-48 days. Once the time limit is exceeded, liquid helium will “boil off” and expand into gas, leading not only to resource loss but also sharply increasing storage pressure, which poses safety risks.

This means that the helium inventory already en route when the Middle Eastern conflict broke out is expected to run out by mid-April at the latest. At that point, the global supply chain will lose its last buffer.

Zhuochuang Information analyst Zhang Weizeng told Jiemian News that Qatar’s helium production accounts for about 30% of global supply. By 2025, China’s imports from Qatar will reach 54%. The current supply interruption has intensified global supply concerns.

He pointed out that although some sources say Qatar’s core facilities are not significantly affected, ongoing Middle Eastern tensions and uncertain resumption times have shifted market sentiment. Especially as market participation in the middle segments increases, domestic helium trading has improved. As upstream shipment pressures ease, prices continue to rise.

In an environment of extreme supply scarcity, helium is flowing to the highest bidders.

If a chip factory halts production, daily losses can reach hundreds of millions of dollars. Some major chip companies are “stockpiling” globally, even at the cost of overwhelming prices to divert quotas originally allocated for hospitals’ MRI equipment and research institutions.

Helium is mainly extracted from natural gas enriched with helium. An article published last year by Science and Technology Daily showed that the average helium abundance in China’s natural gas fields is only 0.03%-0.05%, far below the 1%-7% level of international rich-helium fields. The “poor helium” characteristic makes traditional helium extraction technologies in China inefficient.

This has made China a major importer of helium. An article in China Mining magazine titled “Current Status and Future Development Directions of China’s Helium Industry” states that although China’s helium production increased by 16.94 times over the past decade, dependence on imports remains high—above 90% in 2022 and earlier years. It was only in 2024, due to a significant increase in domestic production, that the dependence dropped for the first time to 83.51%.

From 2020 to 2024, China’s helium capacity surged 6.93 times, but utilization rates remained low, reflecting issues such as high production costs and insufficient raw gas supply, making it difficult to effectively release capacity.

Image source: | China Mining “Current Status and Future Development Directions of China’s Helium Industry”

Amid the chaos of global supply chain restructuring, China’s market is actively responding to the helium shortage.

Some market insiders told Jiemian News that helium from Siberia, Russia, is accelerating its land route into China.

CITIC Securities research reports indicate that if geopolitical conflicts escalate and the Strait of Hormuz remains closed, Russia and Algeria will gain more market share in China’s helium market. Meanwhile, helium prices could see significant increases amid domestic industry chain stockpiling. Companies with domestic helium resources and long-term overseas contracts are expected to benefit from high profit elasticity, as are those engaged in helium recovery and recycling.

Guoxin Securities’ latest report states that leading domestic gas companies are accelerating the construction of a global, diversified helium supply system. By securing multi-source helium resources, expanding storage and transportation capacity, and tackling independent helium extraction technology, these companies are poised to gain considerable profit margins during price hikes and meet the demands of core fields like integrated circuits and healthcare within the broader semiconductor industry.

Over the past few years, Chinese geologists have been refining exploration techniques to find more helium sources.

The Ministry of Natural Resources’ official website shows that during the 14th Five-Year Plan period, China has achieved a major leap in helium exploration and development from zero, greatly reducing reliance on external helium imports. The country’s newly confirmed geological reserves amount to 4.07 billion cubic meters, with six gas fields—Suri Ge, Fuling, Jingbian, Anyue, Dongsheng, and Luzhou—each exceeding 200 million cubic meters in proven reserves.

According to a report cited by Guoxin Securities and data from Zhuochuang Information, China’s helium capacity is projected to reach 14.66 million cubic meters by 2025, with a compound annual growth rate of 116% from 2019 to 2025; helium production is expected to reach 4.63 million cubic meters in 2025, with a compound annual growth rate of 90% over 2019-2025.

Recently, domestic helium concept stocks have been driven by geopolitical premiums, with clear signs of capital chasing gains. Several stocks, including Snowman Co., Ltd., recently hit the daily limit, with significant net inflows of large orders, indicating that major funds are rapidly positioning in companies with storage and transportation capabilities.

Oriental Fortune Helium Concept BK0949 Image source: Oriental Fortune screenshot

According to incomplete data from Jiemian News, the main domestic companies producing helium include Huate Gas (688268.SH), Guanggang Gas (688548.SH), Jiufeng Energy (605090.SH), Jinhong Gas (688106.SH), and Hangyang Co., Ltd. (002430.SZ).

Among them, Huate Gas’s helium business accounts for about 45%, making it the only domestic enterprise capable of mass-producing 6N-grade (99.9999%) electronic-grade helium, certified by ASML, and directly supplying the semiconductor industry.

Guanggang Gas is China’s largest domestic helium supplier. In February last year, it signed a 20-year long-term supply agreement with Qatar, with imports accounting for 13.4% of the national total.

Jiufeng Energy is a leading domestic helium extractor, operating an BOG helium extraction project in Inner Mongolia, with an annual capacity of 1.5 million standard cubic meters and helium purity reaching 99.999%.

Jinhong Gas is a 6N high-purity helium supplier, with long-term agreements with Russia and France, and is also advancing the construction of a helium extraction project in Xinjiang. According to a report on Securities Daily on April 1, Jinhong Gas stated that it currently has sufficient helium resources and stable overall supply capacity.

The company said it is continuously integrating high-quality global helium resources, diversifying overseas resource deployment to ensure long-term stability and reliability, and actively developing domestic helium resources. The Xinjiang BOG helium extraction project is expected to enter trial production in the third quarter of this year, further enhancing its independent supply capacity and resource security.

Hangyang Co., Ltd. is a leader in air separation equipment, with a market share of over 80% in helium extraction equipment, operating a dual business model of self-produced helium and helium extraction equipment.