DRAM Prices Could Be On The Rise

Japanese DRAM makers’ woes echo rest of industry after quake. According to new reports, the earthquake and resulting tsunami in Japan continue to affect production at key factories making 12-inch silicon wafers, the raw materials that chips are etched onto. Market researcher IHS iSuppli estimates that damage to these factories could reduce the supply of silicon wafers globally by 25 percent, which “could have a major effect on worldwide semiconductor production,” particularly DRAM chips.

Other chip factories are being hurt by rolling blackouts meant to share electricity made scarce because several power plants were knocked offline in the disaster. DRAM is required for nearly every PC, laptop, smartphone and tablet produced, while all gadgets need a host of chips to run different internal functions. At least three major suppliers of silicon wafers, Sumco, Shin-Etsu Chemical and MEMC Electronic Materials, lost some output due to the disaster. Sumco and Shin-Etsu alone account for 72 percent of all 12-inch silicon wafers, according to Credit Suisse. Sumco, the world’s biggest supplier of 12-inch wafers, said March 28 it has begun repairs at a factory in Yonezawa, although the company did not say when the plant may be running again. Shin-Etsu, the world’s second-biggest supplier of 12-inch silicon wafers, said March 25 that production at two of its factories remains “wholly halted.” MEMC, a U.S. company, shut operations at its factory in Utsunomiya, after the earthquake and said it expected “shipments from this facility will be delayed over the near term.” Without reliable power and with transportation still disrupted by earthquake and tsunami damage, the supply of wafers from these companies will continue to be affected. Renesas Technology said March 28 that it does not expect production at its chip fabrication plant in Hitachinaka to begin until July, and then it will only be at part of the plant.

Source: http://www.computerworld.com/s/article/9215247/Japanese_DRAM_makers_woes_ec ho_rest_of_industry_after_quake?taxonomyId=12&pageNumber=1