US Department of Commerce announces new system for detecting supply chain shortages
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US Department of Commerce announces new system for detecting supply chain shortages

The US Department of Commerce Monday unveiled its Microelectronics Early Alert System, a new system for detecting supply chain shortages in the semiconductor industry.

This system is part of President Biden’s program for strengthening supply chains in semiconductor manufacturing, batteries, critical minerals, and pharmaceuticals. Biden signed an executive order on February 24 ordering 100-day supply chain reviews for these four industries. The 100-day report for the semiconductor industry highlighted the globalized and fragile nature of the semiconductor supply chain.

The Department of Commerce’s new alert system will consolidate information from producers and manufacturers. The goal of a centralized information-gathering system is to minimize disruptions to the semiconductor supply chain without companies revealing business confidential information to competitors.

Semiconductors are essential to a number of large US industries, including the automotive industry and the tech industry. Global backlogs can be instigated by the smallest issues, such as a brief power outage in Taiwan. The largest semiconductor manufacturer, Taiwan Semiconductor Manufacturing Corp. (TSMC) has also struggled from a historic drought in Taiwan. Semiconductor foundries rely on large amounts of water to maintain chip supplies.

The US is seeking other options to promote semiconductor independence in the future. The CHIPS for America Act would provide $52 billion in domestic semiconductor manufacturing and establish a science directorate at the National Science Foundation to promote emerging technologies.

The importance of semiconductor independence has been recognized by the European Union and China, who are both exploring options promoting domestic semiconductor manufacturing.