Wednesday, September 15, 2010
DRAM manufacturing costs increased for the first time in nearly four years in the second quarter, stoking concerns about memory production expenses, according to the market research firm iSuppli Corp.
The average production cost for DRAM rose to $2.03 per gigabit in the second quarter, up from $2 in the first quarter, according to iSuppli¡¯s memory price tracking and forecasts. The increase was only 1.2 percent, but it signals a major departure from the historical trend, which has seen manufacturing costs decline by an average of 9.2 percent every quarter since the beginning of 2005, iSuppli said.
The last time DRAM production costs climbed on a sequential basis was in the third quarter of 2006, according to the firm.
ISuppli (El Segundo, Calif.) attributed the increase in DRAM production costs to the actions of two major producers, Japan¡¯s Elpida Memory Inc. and Taiwan-based Nanya Technology Corp. ranked third and fifth, respectively, among global suppliers. Elpida's 11 percent production cost increase stemmed from changes in cost structure after the company increased manufacturing outsourcing to other firms, while Nanya's 4 percent increase was related to ifficulties in migrating from an older trench technology to the newer stacked process, according to iSuppli. The firm expects costs for both companies to decline going forward.
The rising production expense in the second quarter comes on top of the fact that costs during the period declined by much less than the average during the previous nine months, a period that saw an average decline of just 1.7 percent per quarter sequentially since the third quarter of 2009, iSuppli said.
All told, DRAM manufacturing costs have not declined at normal rates in nine months, and there is concern that cost reductions have been limited during the last three consecutive quarters, iSuppli said.
By: DocMemory
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