Opportunities and challenges for the development of domestically produced liquid helium under the influence of geopolitics
Helium, a non-renewable and rare strategic resource, plays an irreplaceable core role in high-end fields such as semiconductor chip manufacturing, medical MRI, aerospace, large-scale scientific projects, quantum technology, and controlled nuclear fusion, thanks to its unique properties including extremely low boiling point, low density, and chemical inertness. It is the fundamental lifeline supporting the development of the nation's high-tech industries. Currently, the dramatic upheavals in the global geopolitical landscape are profoundly reshaping the global helium supply chain, bringing unprecedented historical opportunities to the development of my country's domestic Liquid Helium industry, while also posing severe challenges.
- Escalating Geopolitical Conflicts Cause Systemic Shock to the Global Helium Supply
Chain, Widening Domestic Supply Gap Since 2026, the global helium market has experienced its most severe supply crisis since 2000. The core driving factors are the combined impact of Middle East geopolitical conflicts and Russian export controls. Approximately 40% of global Helium Production capacity was effectively cut off or frozen within just six weeks. As the world's second-largest helium consumer, with an import dependency rate as high as 84%, my country was severely affected, and its domestic helium supply entered an unprecedentedly tight phase.
- Middle East Conflicts Directly Cut Off Core Global Helium Supply Channels
On February 28, 2026, the US and Israel launched a military strike against Iran, severely paralyzing shipping capacity in the Strait of Hormuz. Qatar, as the world's second-largest helium producer, with a production of 64 million cubic meters in 2025, accounting for more than one-third of global production, relies entirely on the Strait of Hormuz for all its helium exports, thus disrupting this supply line. In March, Iran launched a missile attack on the Ras Raffarin industrial city in Qatar, the world's largest liquefied natural gas (LNG) export facility, which houses almost all of Qatar's helium production capacity. The attack directly destroyed approximately 17% of the facility's LNG export capacity, and the associated helium production lines suffered extensive damage. Qatar Energy has officially declared "force majeure," and the recovery time has deteriorated from the initial several weeks to 3 to 5 years of reconstruction, directly resulting in a long-term disruption of approximately 30% of the global helium supply. Simultaneously, a large number of tank containers used for storing and transporting cryogenic liquid helium are stranded in the Persian Gulf region. The strict production standards, long production cycles, and high costs of liquid helium tank containers, coupled with the inability to replenish them in the short term, further exacerbate the operational obstacles to the global liquid helium supply chain.
- Russia further tightens export controls on the global helium supply.
On April 13, 2026, the Russian Federal Government issued a decree formally imposing temporary export controls on helium, with the measures valid until the end of 2027. The core content includes: adding helium to the list of goods requiring special permission from senior Eurasian Economic Union (EAEU) officials for export; requiring special permission at the Russian Prime Minister level for helium exports to all countries and regions outside the EAEU, subject to strict supervision by the Russian Ministry of Industry and Trade; and reducing helium export quotas from April 2026 to the end of 2027 to 40% of the level in the same period of 2025, prioritizing the needs of key domestic sectors such as fiber optic manufacturing, defense, and chip manufacturing. Russia is the world's third-largest helium producer, accounting for approximately 8% of global production, and is also my country's second-largest source of helium imports. In January and February 2026, Russia's helium exports to China accounted for 52%-65% of my country's total helium production, ranking first. This export control directly led to a significant decline in my country's helium imports from Russia. In April, my country's helium imports decreased by 50.38% compared to March, and from May 1st to 20th, imports were only about 15% of the normal monthly average, further narrowing domestic import channels.
- Domestic Helium Supply and Demand Data Under Comprehensive Pressure in January-June 2026.
From the demand side, my country's helium demand continues to maintain rigid growth, with total demand expected to exceed 40 million cubic meters in 2026, representing a year-on-year increase of over 20%. The semiconductor industry is the largest demand driver, accounting for 41%. In 2026, domestic 12-inch advanced process wafer fabs will continue to expand production, with each fab consuming over 500 tons of helium annually, 3-5 times that of mature processes, driving a 14%-18% year-on-year increase in helium demand in the semiconductor sector. The medical MRI field accounts for 36%, with over 3,000 new MRI devices added in 2026, bringing the total to over 35,000. Each device requires an average of 0.5 tons of liquid helium annually, providing stable demand support. Demand in emerging fields such as aerospace, quantum computing, and controlled nuclear fusion is experiencing explosive growth. The number of space launches is expected to exceed 70 in 2026, with demand growth in the quantum computing field exceeding 150% and demand in the controlled nuclear fusion field increasing by over 50% year-on-year. From the supply side, domestic helium production capacity is severely insufficient. In 2025, domestic helium production capacity was approximately 14.68 million cubic meters, while domestic helium production was 5.45 million cubic meters, resulting in a capacity utilization rate of less than 40%. From January to June 2026, domestic helium production was estimated at 2.9-3.3 million cubic meters, meeting only about 10% of domestic demand, with the remaining 90% heavily reliant on imports. Customs data shows that my country's helium imports were approximately 600 tons in January 2026, dropping to 400-500 tons in February due to the Spring Festival, further declining to approximately 350 tons in March, and plummeting to 283.75 tons in April due to Russian export controls, a 50.38% decrease compared to March. May imports are projected to be only 65-75 tons, a further 61%-66% decrease compared to April, and June imports are expected to further decrease to 50-60 tons. From January to June 2026, my country's cumulative helium imports are estimated to be only about 2,200 tons, a decrease of more than 60% compared with the same period in 2025. The domestic helium supply gap has reached more than 60%, and the inventory has entered a stage of accelerated depletion. After mid-April, most domestic distributors have entered the period of inventory depletion, and the price of helium has risen sharply. The price of bottled helium has quickly risen to more than 530 yuan/cubic meter. The average price of tube bundle helium is expected to remain at a high level in 2026.
- The domestic liquid helium industry ushered in a historic opportunity for development, while facing severe challenges.
Against the backdrop of continued turmoil in the global helium supply chain and an expanding domestic supply gap, the strategic value of the domestic liquid helium industry has been elevated to unprecedented heights, ushering in a historic opportunity to leapfrog from "supplementary substitution" to "independent and controllable". At the same time, it also faces a series of severe challenges such as core technology breakthroughs, cost control, and large-scale development.
(I)Core development opportunities for the domestic liquid helium industry
- National strategic security needs promote the comprehensive acceleration of the domestic substitution process.
Helium is an important strategic resource related to national security and people's livelihood. In the past few years, about 95% of my country's helium resources relied on imports. The sources of imports were highly concentrated in a few countries such as Qatar and Russia. Supply interruptions caused by geopolitical conflicts directly threatened the security of many national strategic industries such as my country's semiconductor, medical, aerospace, and national defense industries. Against this background, the national level attaches great importance to the independent control of helium resources. The "14th Five-Year Plan for Modern Energy System" and the "14th Five-Year Plan for Raw Materials Industry Development Plan" both clearly list helium and other rare gases as strategic mineral resources, and promote the localization of helium extraction technology and equipment and the independent development of helium resources. At present, domestically produced liquid helium has changed from an "optional" to a "must have" to ensure national strategic security, and the domestic substitution process has entered a fast lane of comprehensive acceleration.
- The explosive growth of domestic high-end industries has provided a broad market space for domestic liquid helium.
my country is the world's largest consumer of semiconductor chips. In 2026, global semiconductor revenue is expected to increase by 26.3% year-on-year to US$975 billion. Domestic 14nm and below advanced Process wafer fabs continue to expand production, third-generation semiconductors, memory chips and other fields are developing rapidly, and the demand for high-purity helium continues to rise. In 2025, helium consumption in the semiconductor field will reach 18.5 million cubic meters, accounting for 41% of total domestic consumption, and is still maintaining rapid growth. At the same time, domestic cutting-edge scientific and technological fields such as controllable nuclear fusion, quantum computing, and large-scale scientific engineering have entered a period of rapid development. A number of major national scientific and technological infrastructures, such as the China Fusion Project and Advanced Light Source, have successively started construction. The demand for liquid helium has shown explosive growth. The annual liquid helium consumption of a single large scientific device can reach hundreds of tons, providing long-term, stable, and high value-added market demand for the domestic liquid helium industry.
- The restructuring of the global helium supply chain has created a favorable market environment for domestically produced liquid helium.
This round of geopolitical conflicts has completely disrupted the original global helium supply chain pattern. The supply capacity of traditional exporting countries such as Qatar and Russia has continued to shrink, and the global helium market has shifted from a long-term tight supply and demand balance to a structural shortage. Helium prices have remained high, significantly narrowing the price gap between domestically produced and imported liquid helium, creating an extremely favorable price environment for the market promotion of domestically produced liquid helium. At the same time, domestic downstream enterprises have attached unprecedented importance to supply chain security, and have sought diversified and localized helium supply channels. They are willing to provide more market validation opportunities for domestically produced liquid helium, opening the market door for the large-scale development of the domestic liquid helium industry.
(II) Severe challenges faced by the domestic liquid helium industry
- Weak local helium resource endowment and a continuously widening supply and demand gap
my country is a typical helium-poor country with inherent shortcomings in local helium resource endowment, and the industry's development faces hard resource constraints. Domestic helium relies entirely on natural gas associated resources. The proven reserves account for only about 7% of the global total. There are no independently exploitable helium mines, and resources are concentrated in three major inland basins, with limited development space. Meanwhile, the helium concentration of most domestic gas sources is around 0.03%, far lower than that of high-quality overseas gas fields, significantly increasing the difficulty of helium extraction. The weak resource base directly leads to a severe shortage of domestic supply. In 2025, China's total helium production was far lower than its total consumption, with an industry self-sufficiency rate of only 16%, resulting in extremely high dependence on imports. Furthermore, the demand from downstream sectors such as semiconductors, high-end medical devices, and aerospace research continues to grow rapidly, widening the supply-demand gap year by year. Domestic production capacity is completely unable to meet the development needs of high-end industries.
- Domestic helium extraction technology still needs improvement, and the domestic supply of high-end products is insufficient.
Given the limited resources, my country's core technologies for natural gas helium extraction still have significant room for improvement, resulting in insufficient domestic supply capacity for high-end products. Currently, the parameters of mainstream helium extraction processes such as cryogenic distillation and membrane separation have not been fully optimized and matured. Breakthroughs are still needed in the efficient enrichment and purification processes for domestic low-grade helium sources, resulting in problems such as low purification accuracy and high energy consumption. Although China's domestic low-end industrial helium production capacity has gradually increased, the domestic production capacity of 6N and 7N ultra-high purity liquid helium required for high-end products such as semiconductors and superconducting research is insufficient, and the country still relies heavily on imports. This cannot meet the rigid demand of the domestic high-end manufacturing sector, and the localization of high-end helium extraction technology still needs to be continuously promoted.
- High overall production costs and weak market competitiveness:
The disadvantage of domestic helium resources, coupled with the difficulty of helium extraction technology, has driven up the overall production cost of domestically produced liquid helium, limiting the industry's scale development and market competitiveness. Due to the extremely low helium content of domestic natural gas, a large amount of feedstock gas needs to be processed to produce a unit volume of helium, directly increasing basic production costs. At the same time, domestic helium-containing natural gas resources are concentrated in leading oil and gas companies, leaving helium extraction producers with weak bargaining power over feedstock prices and difficulty in securing stable, low-priced gas sources, further exacerbating cost pressures. From the perspective of industry competition, the competitiveness of domestically produced liquid helium exhibits significant cyclical fluctuations. Currently, with a tight global helium supply, domestic products have a short-term price advantage, but overall costs are still higher than those of high-quality overseas production capacity. Once international supply eases, the high cost disadvantage of domestic production will quickly become apparent. Achieving cost reduction through technological iteration at scale is key to the industry's breakthrough.
- Significant shortcomings in cryogenic storage and transportation infrastructure and low supply chain efficiency:
The systemic shortcomings in the midstream cryogenic storage and transportation system further reduce the efficiency of the domestic helium supply chain. The domestic industry suffers from an overemphasis on production and a neglect of storage and transportation. Production capacity is concentrated in the inland northwest, while the high-end consumer market is concentrated in the eastern coastal areas. This geographical mismatch between production and sales leads to high long-distance logistics costs and transportation losses. Meanwhile, the number of large-scale liquid helium storage and distribution bases and specialized storage and transportation equipment in China is insufficient, and the overall supporting capacity cannot meet market demand. Although domestically produced high-end storage and transportation equipment has achieved technological breakthroughs, compared with international advanced levels, the evaporation loss rate of domestic storage and transportation equipment is relatively high. Furthermore, the industry lacks unified standards for storage and transportation equipment and filling and testing, resulting in poor compatibility for cross-regional allocation and a serious lack of stability and resilience in the supply chain.
- The incomplete helium recycling system leads to insufficient resource utilization efficiency.
As a non-renewable resource, liquid helium cannot be reused after venting. Recycling is an effective way to alleviate resource shortages, but the current industry recycling system is incomplete. Only some high-end manufacturing and ultra-high-field medical equipment have recycling systems, and most helium is still vented and lost. At the same time, China lacks professional helium recycling and processing technologies and application promotion. Dispersed helium resources cannot be uniformly purified and reused, and a complete recycling industrial chain has not yet been formed, so the utilization rate of helium resources needs to be improved.
- Incomplete industry standards and industrial ecosystem restrict the long-term development of the industry.
The high technical barriers, incomplete industry standards, reserve mechanisms, and industrial collaborative ecosystem of the entire liquid helium industrial chain are reasons restricting the long-term development of domestic liquid helium. Currently, domestic standards for the entire chain, including helium extraction processes, helium liquefaction, high-purity liquid helium grading and testing, storage and transportation safety, and recycling and purification, still need to be supplemented and improved, restricting the large-scale promotion and market acceptance of products. At the same time, the scale of domestic helium strategic reserves is limited, and a distributed emergency reserve network has not yet been formed, making it difficult to withstand extreme risks such as import supply disruptions and global helium shortages. The liquid helium industry chain lacks collaborative R&D and supply and price stabilization mechanisms, resulting in long-standing problems such as insufficient gas supply, high costs, and unstable supply chains. Furthermore, the downstream high-end market lacks sufficient acceptance of the quality and stability of domestically produced helium sources, and the product access certification cycle is lengthy, further delaying the overall progress of domestic substitution.