Drought in Taiwan Pits Chip Makers Against Farmers (nytimes.com) 50
smooth wombat writes: Chuang Cheng-deng's modest rice farm is a stone's throw from the nerve center of Taiwan's computer chip industry, whose products power a huge share of the world's iPhones and other gadgets. This year, Mr. Chuang is paying the price for his high-tech neighbors' economic importance. Gripped by drought and scrambling to save water for homes and factories, Taiwan has shut off irrigation across tens of thousands of acres of farmland. The authorities are compensating growers for the lost income. But Mr. Chuang, 55, worries that the thwarted harvest will drive customers to seek out other suppliers, which could mean years of depressed earnings. "The government is using money to seal farmers' mouths shut," he said, surveying his parched brown fields.
Officials are calling the drought Taiwan's worst in more than half a century. And it is exposing the enormous challenges involved in hosting the island's semiconductor industry, which is an increasingly indispensable node in the global supply chains for smartphones, cars and other keystones of modern life. Chip makers use lots of water to clean their factories and wafers, the thin slices of silicon that form the basis of the chips. And with worldwide semiconductor supplies already strained by surging demand for electronics, the added uncertainty about Taiwan's water supply is not likely to ease concerns about the tech world's reliance on the island and on one chip maker in particular: Taiwan Semiconductor Manufacturing Company.
More than 90 percent of the worldâ(TM)s manufacturing capacity for the most advanced chips is in Taiwan and run by TSMC, which makes chips for Apple, Intel and other big names. The company said last week that it would invest $100 billion over the next three years to increase capacity, which will likely further strengthen its commanding presence in the market. TSMC says the drought has not affected its production so far. But with Taiwan's rainfall becoming no more predictable even as its tech industry grows, the island is having to go to greater and greater lengths to keep the water flowing. In recent months, the government has flown planes and burned chemicals to seed the clouds above reservoirs. It has built a seawater desalination plant in Hsinchu, home to TSMC's headquarters, and a pipeline connecting the city with the rainier north. It has ordered industries to cut use. In some places it has reduced water pressure and begun shutting off supplies for two days each week. Some companies, including TSMC, have hauled in truckloads of water from other areas.
Officials are calling the drought Taiwan's worst in more than half a century. And it is exposing the enormous challenges involved in hosting the island's semiconductor industry, which is an increasingly indispensable node in the global supply chains for smartphones, cars and other keystones of modern life. Chip makers use lots of water to clean their factories and wafers, the thin slices of silicon that form the basis of the chips. And with worldwide semiconductor supplies already strained by surging demand for electronics, the added uncertainty about Taiwan's water supply is not likely to ease concerns about the tech world's reliance on the island and on one chip maker in particular: Taiwan Semiconductor Manufacturing Company.
More than 90 percent of the worldâ(TM)s manufacturing capacity for the most advanced chips is in Taiwan and run by TSMC, which makes chips for Apple, Intel and other big names. The company said last week that it would invest $100 billion over the next three years to increase capacity, which will likely further strengthen its commanding presence in the market. TSMC says the drought has not affected its production so far. But with Taiwan's rainfall becoming no more predictable even as its tech industry grows, the island is having to go to greater and greater lengths to keep the water flowing. In recent months, the government has flown planes and burned chemicals to seed the clouds above reservoirs. It has built a seawater desalination plant in Hsinchu, home to TSMC's headquarters, and a pipeline connecting the city with the rainier north. It has ordered industries to cut use. In some places it has reduced water pressure and begun shutting off supplies for two days each week. Some companies, including TSMC, have hauled in truckloads of water from other areas.
Send crypto miners the bill (Score:1, Flamebait)
Send gamers the bill (Score:2)
I'm sure [insert sacred cow] could be inserted anywhere in this discussion. A lot of people are just bitter they can't kick the gaming addiction which drives the whole, "gotta have the latest and greatest" computer hardware.
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irony.
suffering from a drought.
on an island.
on the planets biggest body of water
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anyone who owns an iPhone to pitch in
This but unironcially.
Re:Send crypto miners the bill (Score:5, Insightful)
Since they made so much money from wasting silicon production on mining asics
Actually, they're not wasting that silicon as they aren't throwing it away -- Smartphone manufacturers, on the other hand, are far more wasteful with their product lifecycles of "2 years of updates, then it's EOL trash, and throw it away".
Only the buyer of the product gets to determine whether it was a waste or not, anyways.
It's a waste (Score:2)
It's not even useful as a means of escaping the problems with fiat currencies, since it's so easy to do currency manipulation on crypto currencies as to make them useless.
Crypto is one of the worst things to happen to human civilization since mechaniz
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There aren't any significant amounts of crypto ASICs being made at the moment, though that's largely because fabs like TSMC view them as non-recurring customers and are assigning them very low priority at a time when their capacity is far below demand.
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Life cycles. (Score:3)
Somewhere, somewhere in all this story should be the one about recycling water.
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Somewhere, somewhere in all this story should be the one about recycling water.
Recycling only makes sense if the cost of recycling water is lower than the cost of reducing waste.
Since the biggest waste is growing subsidized rice, the cost of reducing waste is less than zero. Ending the waste will actually save money.
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Also, desalination of ocean water might be significantly more expensive than just catching falling rain, but it is not like outlandish expensive, relative to the prices of micro chips.
The cost needs to be compared to the bottom of the market, not the top.
Is desalination of ocean water a cost-effective way to flood a rice paddy?
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Whether it's waste is a value judgment. Many countries, including the US, subsidize food for national security concerns. Granted, these concerns aren't always entirely rational (the US is a case in point) but in the case of *Taiwan*, feeling uncertain about food imports is at least understandable.
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Many countries, including the US, subsidize food for national security concerns.
The US subsidizes agriculture for political reasons.
Presidential campaigns start in Iowa.
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I wouldn't argue with that. But Taiwan's security concerns are more genuine.
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Actually farm subsidies - in general - are because the food is *too cheap*. We artificially increase the price of food so that the remaining 1% working on agriculture can sustain themselves. (Not talking about the mega-farms here. Go talk to a small local farmer in California and see how much they can make).
But... we also do subsidize the wrong behavior. All those corn syrup came because we did not allow importing sugar (tariffs, ahem). That part is not defendable.
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That's where TSMC is located. TSMC is basically the largest chip manufacturer in the world (or close to it).
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Does Taiwan have the secret recipe and wonâ(TM)t let anyone see it?
Yes. TSMC knows how to make 5 nm ICs. They are working on 3 nm.
How they do it is a trade secret.
The only other company in the world that comes close is Samsung in Korea. But Samsung does not have the yields or capacity of TSMC.
The solution to the water problem is to stop subsidizing water-wasting crops. By far, the biggest problem is rice. The farmers should shift to less thirsty and more profitable crops like fruit and vegetables. Taiwan can import rice from Thailand or Vietnam.
Re:Why Taiwan? (Score:5, Informative)
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It is true that rice does not need to be submerged. But the cultivars grown in Taiwan are paddy-based, and the hilly terrain does not favor upland rice.
Economically, it makes no sense for Taiwan to grow so much rice, even without water scarcity. The subsidized cost is way above the import price. Thailand and Vietnam have big surpluses, partially because of their own idiotic subsidy schemes.
Taiwan's "food security" issue is better addressed with a six-month stockpile than with subsidies.
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No. Any island nation should maintain food production capacity that can feed their population, at least to the point that a major global disaster or war won't make them starve to death.
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Rule 1: NEVER do things that make your staple grain an IMPORT!!!
Trust me, it's a bad idea in the long run. And the short run....
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This. It's destroyed more civilizations than anything else. Taiwan is gambling with the core requirement of a government.
Re:Why Taiwan? (Score:4, Informative)
The solution to the water problem is to stop subsidizing water-wasting crops. By far, the biggest problem is rice. The farmers should shift to less thirsty and more profitable crops like fruit and vegetables. Taiwan can import rice from Thailand or Vietnam.
Hey, Taiwanese in Taiwan here. The problem isn't subsidization. I'm not even sure they're being subsidized for growing a specific crop. The problem is more nuanced than that. Rice is part of our daily diet, from the rice bowl dishes to popped rice to rice noodles, etc. Also, no one here buys rice (generalized statement, not absolute statement) from thailand or vietnam because it's just not as good. It would be like telling all of america to stop eating beef in all together and, instead, replace it with chicken. I know it's hard to imagine, but even I, who lives in Taipei, has met the rice grower that I buy my rice from from Tai Dong. Much of our economy, especially food, is very very local. This is part of why, even when China bans imports of pineapples or international travel and trade is restricted, we can carry on with a good amount of resiliency.
Besides, it's not an all or nothing thing. Average complaints in mandarin often gets translated to sound harsher than it is in english. The statement from the farmer isn't a warning or a prediction, but a worry. There's nothing to say that this will make all farmers quit farming tomorrow. There's nothing to say people will switch to foreign rice at all (I know I won't.). The government has made good strides here to help them out recently (within the last 2~3 decades). Local promotion, special health insurance, banks and credit unions, specialized tax codes, etc. And despite what the article said, there have been some young people that decided to do farming instead of a white collar job because it is their passion and more personally satisfying. From tea leaves to fruits to, yes, rice and wheat. So it's less like "government bad, farmers good." It's more like "these are the procedures that helped in the past but hurting now. What can be changed or how can we look at a problem differently to make a better outcome?" Because, in the end, both chip making and farmers are important. Either can't survive without the other.
And, I hate to say this, but articles from NYT about taiwan needs to be taken with a grain of salt. They've written stories about taiwan with a wide amount of inaccuracies before. They've also written stories about china that fully lean into their propaganda. For one thing a lot of the farms here use natural pesticide methods so I'm not sure if the quote from the story is accurate. The other is that one of the most established departments in the best university of Taiwan is the agriculture department. Agriculture importance has a long history here. It won't just go away overnight.
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It sure would be nice if we could stop fighting (Score:2)
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Also, who isn't allowed to talk about this? Presumably neither of us are in the half of the world that can't since we're talking about it right here. Further, what the hell do you propose we do in order to "do something" about the problem? Droughts will occur naturally irrespective of climate change, and if you think humans will ever magically agree to how the weather
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Short term, pay off the farmers (Score:2)
Until more fabricators come online elsewhere, it seems logical to pay off the farmers, import food which is pretty much grown everywhere, and make chips with the water.
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I was lucky enough to take a university course on global water issues fairly recently. It was fascinating. My take-away was that agriculture was pretty much the worst use of water from an economic perspective. From a sustainability perspective irrigation was also one of the worst uses of water as the water used in irrigation can mostly be used only once (most is lost to evaporation, run-off, or seepage below the reach of plant roots). Worse, irrigation leads to a build up of salts in the soil. On the other
Re: Short term, pay off the farmers (Score:2)
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The China Threat (Score:5, Insightful)
TSMC controls about 50% of the die market and the majority of the advanced node 7nm and 5nm. Intel has only just got 10nm working after many years of trying.
If China moves against Taiwan, say goodbye to your latest iPhones and AMD processors.
Yes TSMC is now building a tier one plant in the USA, but there will remain significant global capacity in Taiwan and China that will have a massive impact on global supply chains if war breaks out.
At least COVID has served as an early warning to the fragility of having China as such a critical part of global manufacturing.
Reuse the water? (Score:1)
The water used for this manufacturing process doesn't (as far as I know) disappear, so is there any reason why it couldn't be used to water the crop after it's been used to cool the machine or whatever it's doing inside of the factory?
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Plants don't like scalding water. Nor do aquatic animals. You need to meter it out into the local water system slowly enough not to kill everything. In a drought, there's less cool water available for this.
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You do it the other way around (likely trace heavy metals in the factory waste). The factory treats the water anyway, so not a huge issue for them, maybe just an extra pre-treatment step.
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Lab Rice? (Score:1)
Why aren’t they using recycled water for the (Score:2)
The fabs could easily use recycled water, or even salt water for their needs, since they are treating it anyway. Strange this is such a problem.
Also strange that there aren’t more major chip fabs elsewhere... but hey.
Taiwan't infrastructure is archaic (Score:2)
I've visited Taiwan several times on business. The country lacks even a purified water infrastructure for human consumption of water. One dare not drink what comes out of a hotel faucet or run the risk of obtaining diarrhea. It's similar to Mexico.
Bottled water or boiled water only in Taiwan.