Samsung Electronics has put new etching gas into its semiconductor production line in a move towards multiple sourcing of critical materials as the company has heavily relied on Japanese makers.

Tokyo excluded South Korea from a “white list” of preferential export destinations following tightened export regulations on three key semiconductor and display materials, which have been caught up in a looming trade war between the two countries.

An industry source told Asia Times: “The company has begun using substitutes for some of the processes that used Japanese products.”

Etching gas is used in the etching process that cuts off unnecessary parts except for circuits on semiconductors and display panels. It comes in liquid and gas form and Samsung has started to utilize the liquid version.

An industry insider said: “It is highly likely that Samsung put Korean-made etching gas into the production line.”

Samsung and South Korean memory chip maker SK Hynix have tested non-Japanese-made etching gas to replace Japanese products. SK Hynix has yet to inject alternatives, according to industry insiders.

“Samsung Electronics and Hynix have been testing almost all etching gas regardless of their origin,” another industry source said. “I understand that there are concerns about the supply of etching gas, but in fact, there are many substitutes.

“Chipmakers have to fine-tune their manufacturing processes to utilize new etching gas while maintaining yields and quality of products, So they continued to rely on Japanese materials.”

Display industries also plan to use Korean etching gas to replace the Japanese one. According to industry sources, LG Display has finished testing Korean etching gas and plans to put it into the production process soon, while Samsung Display is still testing it.

In display production, the etching gas is mainly used for cleaning, while small amounts are also used for etching. As with the semiconductor etching process, display etching requires ultra-high purity etching gas, but not much of it is needed, according to industry insiders.

Export restrictions by Tokyo require Japanese chip and display material manufacturers to obtain individual approval from the Japanese government when they export to Korea etching gas, fluoride polyimide, which is used in displays, and photoresist, which is used in the EUV (extreme ultraviolet) process to fabricate semiconductor substrates.

According to industry sources, LG Display does not use Japanese fluorine polyimide, while Samsung Display is planning to replace it with Korean products.

The Japanese government has approved the export of EUV photoresist to South Korea two times and etching gas once since it tightened export controls of three key materials.

Despite this pacificatory attitude of Tokyo, industry experts predict that South Korean firms’ move for multiple sourcing will continue as they feel uncertainties remain.