Memory chip prices reach two-year high in wake of Hynix plant fire

By on September 24, 2013, 4:30 PM
sandisk, micron, hynix, memory, fire, sk hynix, memory chips

A fire earlier this month at SK Hynix Semiconductor’s memory fabrication facility in China is being blamed for a two-year high in memory chip prices. On the day of the fire, a 2GB DRAM chip cost $1.60 and now three weeks later, the same chip sells for $2.27 – good for a 42 percent rise according to a report from Bloomberg.

At the time of the blaze, Hynix said they found no major material damage to fabrication equipment in the plant’s clean room and expected to resume normal operations within a short period of time as to have as little impact on overall production and supply volume as possible.

As it turns out, the fire caused a bit more damage than first thought as production is now set to resume sometime next month. In the meantime, the company has ramped up production in South Korea to help offset the production loss but the financial impact is of course already very real.

Hynix is responsible for about 30 percent of the global DRAM market and roughly half of their chip output came from the China plant.

Oh Sang Woo, a Seoul-based analyst at Leading Investment & Securities Co. said chip prices will continue to rise throughout the fourth quarter or at the very least, there will be no drop until operation gets back into full swing at Hynix.

For some, however, the fire has proven rather beneficial. Boise, Idaho-based Micron Technology is serving as an alternative supplier and has seen their stock rise 23 percent since the fire.




User Comments: 6

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1 person liked this | Guest said:

Same scam they did with the hard disk drives. I wonder what's next ... hmm dvd burners are pretty cheap too nowadays ...

1 person liked this | Guest said:

Floods, then fire...maybe next time these manufacturers will blame earthquake or the aliens for their next price hikes.

RzmmDX said:

Will this affect SSDs?

Really hoping to buy a 500GB one... below $250, sometime in the future...

Sniped_Ash said:

Will this affect SSDs?

Really hoping to buy a 500GB one... below $250, sometime in the future...

It shouldn't because SSDs use flash memory and not DRAM. Even if this affected Hynix's flash production, some SSD manufacturers make their own flash, like Intel, Samsung, and Sandisk so I imagine that they wouldn't be affected in this hypothetical scenario.

Skidmarksdeluxe Skidmarksdeluxe said:

Somebody's smiling all the way to the bank, and they say crime doesn't pay. Maybe I'm just stupid because I believed it.

RzmmDX said:

Will this affect SSDs?

Really hoping to buy a 500GB one... below $250, sometime in the future...

It shouldn't because SSDs use flash memory and not DRAM. Even if this affected Hynix's flash production, some SSD manufacturers make their own flash, like Intel, Samsung, and Sandisk so I imagine that they wouldn't be affected in this hypothetical scenario.

They do supply flash memory too, so it would affect the weird brand names SSD. So it would be interesting to see what happens.

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