Explosive Fire at Hynix DRAM Plant

South Korean owned Hynix, said production should resume shortly after an explosive fire broke out at their China based memory chip plant in Wuxi.

The fire started at around 3.50pm local time yesterday during chip equipment installation and was extinguished in under two hours. Luckily no one was seriously injured in the fire, Hynix  stated that there was only one minor injury and the fire was not as severe as it might seem.

Photos taken at the scene by local media show thick, black smoke billowing from the plant,  but Hynix assure that because the fire was concentrated in the air purification facilities, that are linked to the rooftop of the fab, the smoke seemed much worse than it actually was.

Photo courtesy of chiphell.com

Hynix are the worlds number two maker of DRAM chips and fears that the fire could increase prices yet again (please read our blog post Dram Prices Set to Rise in 2013) are at the forefront of everyone’s minds. Their Wuxi plant produces around 40-50% of their total DRAM output, so suspension of this plant could lead to a shortage in an already tight market.

Hynix has stated that there is currently no material damage to the equipment and therefore they expect to resume operation soon, so overall production and supply volume will not be affected. We will bring you news on this issue as it happens.

To read the article in full, please click here.

Have you thought of scheduling parts to avoid lead times? At Atlantis we offer a free Scheduling Service which will give you complete peace of mind when shortages or long lead times occur as your order can be scheduled up to 12 months in advance, this also helps keep the cost down too.

For more information on our Scheduling Service, please visit our website.

DRAM Prices Set to Rise in 2013

According to semiconductor market research company, IC Insights, DRAM average selling prices have increased each month throughout 2013. The price jumped an estimated 42% in quarter 2 2013, compared to the same period in 2012 following a 22% rise in quarter 1 2013.

IC Insights forecast that the DRAM average selling price will grow to $2.53 by quarter 3 which will be 50% greater than quarter 3 2012. It is then expected to decrease slightly in quarter 4 to $2.52. Please see image below.

IC Insights believe that one contributing factor to the increase in DRAM price is that fewer suppliers are participating in the DRAM market today compared to 2010. Also DRAM capital spending as a percent of sales has declined from 31% in 2011, to 19% in 2012 and is forecast to be only 12% in 2013.

With a reduced amount of new capacity being added, the supply-demand balance is now favouring DRAM suppliers, as demand is beginning to overtake supply, resulting in the increase in price.

Also with the computer industry moving more towards smart phone and tablets over the traditional notebook and desktop, most suppliers have scaled back their output of lower priced PC DRAM and transitioned to higher priced mobile DRAM.

To read the article in full or to download the report, please visit the IC Insights website.

If you are being affected by price increases, why not try Atlantis' Scheduling Service. Your orders can be scheduled up to 12 months in advance, so you get fixed prices, meaning no surprise price fluctuations!