THE COMPONENT SIGNAL

Issue #012 · Monday, March 31, 2026 · Naphtha Watch + Price Hikes + Supplier Audit

The situation has deteriorated. Korea's petrochemical industry is operating on approximately two weeks of naphtha inventory. LG Chem's Yeosu cracker remains shut. Yeochun NCC is still under force majeure. Lotte Chemical is rationing feedstock across its polymer lines.

Why you should care even if you don't buy Korean chemicals: Korean petrochemical output feeds into:

• • Semiconductor fab chemicals (photoresists, etchants, CMP slurries)
• • PCB laminate resins (FR-4, polyimide)
• • Solder paste flux (rosin derivatives)
• • Connector housing materials (LCP, PBT compounds)

Samsung and SK hynix source these chemicals domestically. If Korean petrochemical output drops further, fab throughput follows — regardless of how many wafer starts they've planned.

The waiver question: A temporary US sanctions waiver allowed one Russian naphtha shipment to LG Chem in early March. That waiver expires April 11. Korean industry groups are lobbying for an extension. If it's not renewed, the buffer drops from two weeks to days.

For procurement teams: Treat this as a leading indicator. If you're sourcing DRAM, NAND, or any Samsung/SK hynix product, the naphtha situation is your upstream risk. Price movement will follow inventory depletion by 2–4 weeks.

What this means: If you placed orders before today, you locked in the old price. Anything ordered tomorrow morning hits the new pricing. Distributors will pass through the increases over the next 2–4 weeks as old inventory clears.

TI's 85% increase on select analog parts is the headline number, but it applies to a narrow set of legacy nodes. The median increase across TI's portfolio is closer to 25–30% — still the steepest single-quarter hike since the 2021 shortage.

With the 25% Korean tariff now active and Hormuz disrupting shipping routes, knowing where your parts are actually made — not just where your supplier is headquartered — is a procurement requirement, not a nice-to-have.

Three questions to ask:

1. • Where is the stamping done? The country where the metal is stamped into a shield can determines the country of origin for tariff purposes. Not where the metal was mined. Not where the company is headquartered.
2. • Where is the plating done? Tin plating, nickel plating, or gold flash can be done at a different facility than stamping. If stamping is in Vietnam but plating is in Korea, the finished good may still qualify as Vietnam-origin — but confirm with your customs broker.
3. • Can they provide a Certificate of Origin on demand? If the answer is "we'll get back to you," that's a red flag. Legitimate multi-site manufacturers have CoO documentation ready because they manage this across customers.

The POCONS answer: Engineering in Suwon, Korea. Stamping and plating in Vietnam. US-bound shipments carry Vietnam CoO. Tariff rate: 0%. We provide certificates proactively because most of our competitors can't.

A procurement manager called us Friday asking for a rush quote — their existing Korean shield supplier couldn't provide a Vietnam CoO, and their customs broker flagged the shipment. We quoted the same parts from our Vietnam facility, same specs, same tooling. They had parts clearing customs by Wednesday. The 25% tariff savings on that single order was more than our NRE on the original tooling.

If you haven't placed orders before end of day today, you're buying at the new price tomorrow. For anything on the TI, Infineon, or Murata lines, check distributor stock now — existing inventory is still at old pricing. Once it turns over, the increase is permanent until the next cycle.