Spot DRAM prices have soared over 30% in less than two weeks after a fire broke out at a wafer plant of SK Hynix in Wuxi, China on September 4, jeopardizing wafer production at the plant, according to industry sources.

The spot prices for 2Gb DDR3 chips have surged to US$2.20 recently compared to US$1.50 prior to the outbreak of the fire, while those for 4Gb DDR3 ones have rallied to US$4.20, the sources indicated.

While SK Hynix has stated that the damage caused by the fire was not serious and the Wuxi plant will be able to resume full operations by the end of October, the ramping chip prices indicate that the situation could be more serious and might affect the regular supply of the memory chips, said the sources.

Some PC brands and OEMs, which had previously planned to adjust inventory levels of memory chips in October, are now ready to take contingency measures to build up their inventories instead, said the sources.

Hewlett-Packard (HP) has been indicated as having the lowest inventory level of PC DRAM chips among PC brands and has geared up its purchases of memory chips, revealed the sources, adding that Taiwan-based PC ODMs and Dell appear to have a sufficient level of inventory.

The supply of PC DRAM might become tight, given that suppliers of the memory chips are now limited to Samsung Electronics, Micron Technology and SK Hynix. Among them, Samsung has lowered the ratio of its PC DRAM to 20% of its total production of memory chips, while Micron has switched the PC DRAM lines of its wafer plant in Singapore to production of NAND flash chips, the sources noted.

By: DocMemory
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