Semiconductor Markets Continuing to Have Positive Economy

Aug 04, 2017

Price of DRAM semiconductors rose 5.2% just in last month. Although industries estimated that economy of semiconductor markets reached its peak after announcement of second quarter performance, positive trend of price has not stopped yet. Some predict that sales from DRAMs in 2017 will be 55% higher than sales in 2016 if this trend continues. Samsung Electronics and SK Hynix control about 70% of global DRAM markets.
According to a semiconductor market research organization called DRAMeXchange on the 3rd, average contract price (fixed market price) of PD DDR4 4Gb 512Mx8 2133MHz, which is a standard DRAM product, was $3.25 by the 31st of July. This price is 5.2% higher than average contract price on the 30th of June ($3.09). Compared to average contract price at the end of last year ($1.94), average contract price rose by 67.5% in just 7 months.
“It seems that major DRAM suppliers will not increase their plant and equipment investment by very much in 2018.” said DRAMeXchange. “Increase in production capacity and upgrade in technologies will be limited.” It is likely that price will continue to go up in 2018 due to tight amount of supply.
Average contract price of 128Gb 16Gx8 MLC, which is a universal NAND flash product that is used for memory cards or USBs, also rose 2.3% in just a month from $5.55 to $5.68. Compared to end of last year, it rose by 34.6%.
Amount of market sales is likely to increase vertically this year due to sharp increase in price of memory semiconductors.
“This year’s sales in global semiconductor markets is estimated to be 16% higher than last year’s sales as sales from DRAM and NAND flash memory markets jumped unexpectedly.” said a global market research company called IC Insights on its report.
IC Insights is estimating that sales from DRAM markets and NAND flash markets in 2017 will increase by 55% and 35% respectively compared to last year.
Considering the fact that estimation of grow rate of rest of semiconductor markets excluding these two items is same as last year at 6%, it can be seen that these two items have led growth of entire semiconductor markets. Samsung Electronics and SK Hynix, which control most of memory semiconductor markets, have practically led these markets.
While IC Insights put out its estimation of growth rate of semiconductor markets at 5% early this year, it adjusted it upwardly to 11% in March and put out another corrected value this time.
“Fact that sales from global semiconductor markets are showing increase rate of double figures is the first time since 2010 (33%), which is right after worst recession of these markets, and is the 5th time since 2000.” said on IC Insights’ report. “Sharp increase of sales from memory markets is coming from increase in price rather than increase in number of shipments.”
Staff Reporter Han, Juyeop | powerusr@etnews.com

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