Hurricane Katrina Could Affect RFID Tag SupplyHurricane Katrina Could Affect RFID Tag Supply

Damage from Hurricane Katrina has caused Air Products and Chemicals Inc. to shut down its New Orleans facility that produces hydrogen used in manufacturing silicon wafers, a development that could affect global production of semiconductors, research firm iSuppli Corp. says.

Air Products, a $4.7 billion company with operations in more than 30 countries, is one of the major suppliers of hydrogen used in the deposition of epitaxial films on silicon wafers. The films are used to manufacture semiconductors worldwide. The company's industrial gas complex in New Orleans is the site of much of its hydrogen manufacturing activity.

The films are critical to manufacture higher-voltage semiconductors used in power-management applications for mobile phones, digital camcorders, notebooks and laptops, and liquid crystal display backlights. "The element hydrogen also is used to make today's integrated circuits, or ICs, that are in RFID tags," says Rene Martinez, chief technologist at Intermec Technologies Corp. However, he says, "IC manufacturing for [RFID] tags uses a small fraction of the global IC fabrication capacity."

It's not clear if the shutdown will have any affect on pricing. Air Products says it's working to restore operations quickly. The timing of the plant's restart depends on the availability of power, utilities, communications, infrastructure access, and the extent of the damage, according to a statement on the company's Web site.

The company says that, "based on initial assessments, damage from the hurricane will affect Air Products' ability to supply customers with hydrogen from the New Orleans plant for an extended period of time." It also states that its liquid hydrogen production facility at Sarnia, Ontario, Canada, will be shut down due to a temporary suspension of its supplier's feed-gas plant.

Other suppliers of electronic-grade hydrogen are increasing their output to compensate for the shortfall, and alternative purification techniques are being implemented by silicon manufacturers to allow lower grades of hydrogen gas to be used, according to iSuppli.