Yesterday, for the first time in six years, the Taiwanese government issued a water supply red alert to address severely depleted reserves in the central reservoir. Extensive water rationing has been forced in many areas of the country, including areas where Micron Technology Inc. and Taiwan Semiconductor Manufacturing Corp.'s (TSMC) large wafer fabrication plants are located.

Due to dangerously low water supply levels in the country, non-industrial users in Taichung and throughout Miaoli County will only have access to water for five days each week beginning April 6. TSMC and Micron both operate in the affected areas and depend on stable water supplies for several wafer fabrication processes. TSMC's Hsinchu headquarters is not currently under further restrictions.

What this restriction means for the semiconductor industry is still unclear, but it could exacerbate many global component shortages that are already critical. A disruption at this time would hamper production efforts and affect Intel, AMD, Nvidia, Apple, Kingston, and many others.

TSMC is conducting drills to prepare for a worst-case scenario and plans to increase its reliance on tankers for water. Last month, TSMC conducted an emergency operation when Tainan was placed on Orange Warning.

It is unclear whether the operation was successful, but according to Bloomberg, TSMC claims that "the new restrictions will not affect operations." This reassurance came via an e-mailed statement, and the article notes that "a Micron representative in Taiwan declined to comment, saying the company is currently in a period of quiet."

At least there is hope on the horizon, as the rainy season is approaching and water levels should begin to improve in early summer. Hopefully, the semiconductor industry will stay afloat for the foreseeable future.