Event Roundup - Critical Materials and the UK Semiconductor Sector

On Wednesday 30 September, techUK hosted a webinar bringing together experts from across industry and academia to explore how exposed the UK semiconductor sector is to critical material dependencies, and what the next steps should be to secure the UK's material resilience.

The session brought together techUK's Semiconductor and Sustainability programmes, with expertise spanning supply chain intelligence, advanced materials, atomic-scale manufacturing and electronics recycling.

This is a continuation of techUK's Semiconductor event series. Insights from the session will also inform techUK's future activity around semiconductors, supply chains, and our industry forum, the Critical Minerals Taskforce.

The discussion was co-chaired by Elis Thomas, Programme Manager for Tech and Innovation, and Elisabeth Sullivan, Sustainability Policy Manager, at techUK. We were delighted to be joined by:

Professor Jeff Kettle, Professor in Electronic Engineering at the University of Glasgow, REACT
Thelma Onyeka, Co-Founder and Co-CEO, Beebolt
Shivani Lodhia, Communications Lead, Paragraf
Bonnie Tsim, VP of Commercial Strategy and Partnerships, ATLANT 3D

How exposed is the UK?

Panelists agreed that the UK's exposure to critical material disruption is high, but that its risk profile is distinctive. Around 79% of UK semiconductor revenue comes from fabless design and IP, which is not directly affected by recent raw material shocks. The real vulnerability lies in compound semiconductors, sensors and photonics, which depend on materials such as gallium, germanium and indium.

The production of a single chip involves around 74 countries on average, and risk needs to be understood at a much finer level than it is today, down to individual smelters, processors and substrate suppliers. A single small supplier in one region can disrupt an entire supply chain. Panelists highlighted price disparities, with germanium spot prices in the West cited at roughly double those inside China.

The UK cannot mine most of these materials, many of which are by-products of mining for other metals, and is almost entirely reliant on overseas refining and purification. Virtually all 34 of the UK's critical elements are used somewhere in electronics manufacturing, including helium, which is used in the manufacturing process rather than the final product. There is also a "hidden risk": the UK imports chips, LEDs and other components whose critical material content does not appear in trade statistics.

Another under-discussed vulnerability is access to specialist tooling. Scale-ups can face significant delays accessing tools that are only made by certain companies or countries. Panelists also stressed that securing materials is only the first step: the UK must also be able to discover new materials and scale them into working devices.

Recycling and recovery: technically possible, economically hard

Almost any semiconductor can technically be recycled, but the economics remain the biggest challenge. The UK currently recovers gold, silver, platinum-group metals and some copper, but not the materials that matter most for compound semiconductors and advanced packaging.

Critical materials are often dispersed at parts-per-billion levels in e-waste, so specialised facilities would be needed to concentrate waste streams, and these would likely run at a loss for a long time. One example illustrated the point: a kilogram of smartphone circuit boards is worth around £5,000 as working boards, but only around £50 once shredded for materials recovery. Keeping devices in use for longer, following the hierarchy of avoid, reduce, reuse, refurbish and then recycle, often makes far more sense.

Recycling is also not a short-term fix. Recycled materials can take two to three years to qualify for use in chipmaking because of extreme purity requirements. Panelists called for the UK to better understand the purity specifications manufacturers will accept, and to work closely with international partners such as Taiwan and Japan.

Supply chain visibility and data

Better data and visibility were seen as essential to managing critical material risk. Beebolt shared its work on Conductor, a platform developed over 18 months with SEMI, the global semiconductor industry association, and partners including TechInsights, which gives companies a neutral space to share supply chain data.

Panelists predicted that supply chain risk will increasingly be treated as a whole-organisation issue rather than a procurement topic, with companies appointing dedicated intelligence leads. There were also calls for open-access testing and packaging centres that any UK company could use, drawing comparisons with the model TSMC adopted decades ago.

The UK Critical Minerals Intelligence Centre (CMIC) and REACT's digital twin approach, which models the impact on the UK if one country stops supplying another, were highlighted as valuable tools. The most concerning materials are often those that are cheap per kilo but go into very high-value exported products. However, government trade data is often too crude to be useful: it can show how much nickel the UK imports, for example, but not how much goes into electronics rather than steel.

Are semiconductors getting enough attention?

Panelists agreed that semiconductors and electronics receive far less attention than batteries and magnets in the critical materials debate, despite UK electronics employing tens of thousands more people than those sectors combined. Disruption to electronics supply chains could therefore have a significantly greater impact.

This was also framed as an opportunity. The UK is not seen as a threat by either the US or China, has world-leading universities and doctoral training centres, and could lead global thinking on how supply chains evolve, without needing to match US levels of spending.

Using less, and using different materials

Resilience is not only about securing more materials, but getting more value from every unit used. Conventional chipmaking often coats, etches and wastes much of the material it deposits. ATLANT 3D outlined how its approach deposits material only where it is needed, with the aim of complementing established manufacturing processes rather than replacing them.

Alternative materials also offer a route to reducing dependency. Paragraf explained that graphene is made from carbon, an abundant resource rather than a critical mineral, and that the company has recently begun manufacturing a second material, molybdenum disulphide (MoS₂), which could help make data centre chips more energy efficient. Paragraf also shared its journey from a Cambridge spin-out to a facility in Huntingdon producing six-inch graphene wafers, and kindly offered tours to anyone interested.

Practical barriers to scaling advanced materials companies were also raised, including connectivity, warehouse space, planning permission and access to power.

Bridging the gap to commercialisation

The UK's research funding landscape, including InnovateUK and UKRI, is strong on research, patents and spin-outs, but weaker at bridging the gap to commercialisation. Too many promising UK companies are acquired by overseas firms and move their headquarters abroad.

Panelists reflected that Silicon Valley grew from silicon and Britain's industrial economy from steel, raising the question of what the UK's next foundational material could be. An emerging cluster of London-based AI companies is modelling new materials, but the UK lacks the incentives needed to turn those models into real, proven materials.

University research rarely considers cost, reliability or scalability, and it has taken around 20 years to move from the discovery of graphene to commercial devices. Panelists called for academia to play a greater role in material qualification, alongside open-access facilities where manufacturers can trial new and recycled materials without risking their own production lines. Innovate UK's National Materials Innovation Programme was also flagged during this discussion, and further details are included below.

What should government do?

Panelists urged the UK to look beyond headline infrastructure and focus on the details that could bring supply chains to a halt. This includes contingency planning for overlooked materials such as tungsten, and tackling the shortage of electrical and electronic engineers. Helium offered a striking example: during recent supply pressures, attention focused on chips, but semiconductor manufacturers buy high-purity helium and receive priority, meaning the more immediate knock-on risk was to hospital MRI machines. There were calls for specific UK strategies for materials including gallium, tungsten, yttrium and rare earths.

There was also a strong sense of strategy fatigue. The landscape is moving faster than strategies can be published, and panelists called for the UK to double down on areas where it already leads, such as 2D materials, photonics and quantum, rather than trying to compete with the likes of Taiwan across the board. Industry wants execution plans with clear milestones and named responsibilities, fewer consultations and roundtables, and a seat at the table for smaller companies alongside larger organisations. The UK's Semiconductor Strategy already prioritises compound semiconductors and advanced packaging, and panelists agreed the UK should build strategic strength in these areas, while accepting that full sovereignty across the supply chain is not realistic. Next steps and opportunities Several clear priorities emerged from the discussion:

Better supply chain visibility, with finer-grained data on where critical materials sit across supply chains, and more useful government trade data.
Raising the profile of semiconductors and electronics in the critical materials debate, alongside batteries and magnets.
Open-access facilities for testing, packaging and trialling new and recycled materials.
Stronger routes from research to commercialisation, including greater support for material qualification and scaleups.
A shift from strategy to execution, with clear milestones, named accountability and a voice for smaller companies.
Targeted international partnerships, recognising that no country can secure every material within its own borders.

Where next? techUK is incredibly grateful to our panelists and attendees for making this session so valuable. As a leading voice for the UK semiconductor industry, techUK will be using the insights from this session to inform our future work on semiconductors, supply chain resilience and our Critical Minerals Taskforce. If you are interested in getting involved, please reach out to elis.thomas@techuk.org or elisabeth.sullivan@techuk.org. We're keeping the semiconductor conversation going at our upcoming event, Financing the future of semiconductors, on 10 November at techUK's London office. The session will bring together policymakers, investors and ecosystem leaders to explore how UK semiconductor companies can access the capital, partnerships and routes to market they need to scale. Register for the event here