Flash, DRAM prices spike on worries over supplies from Japan
IDG News Service - Prices of widely used chips, including NAND flash memory and DRAM, have both risen sharply since the 9.0-magnitude earthquake struck and hurled tsunami waves at the northeastern part of Japan.
But major Japanese suppliers have said factories producing these chips were largely unaffected by the temblor, nor are they in areas where blackouts will force production to stop. While it appears by their statements that the memory markets are overreacting to the earthquake, analysts say that the price increases may highlight a graver issue for the global chip industry: damage to Japanese component and material suppliers vital to chip production.
The price of NAND flash memory, which has grown in importance as the main data storage in iPads, iPhones and other mobile devices, has increased by as much as 20 percent since the earthquake struck as companies try to figure out if chip factories in the area were damaged.
Although prices rose, not many people were selling, according to DRAMeXchange, which runs an online clearinghouse for NAND, DRAM and other chips. Most companies seemed more interested in keeping their supplies of the chips instead of taking a quick profit.
The NAND market has reacted so strongly because Japan supplies as much as 40 percent of the world's NAND flash chips, according to Jim Handy , at Objective Analysis.
Toshiba, one of the biggest NAND suppliers in the world, said none of its NAND flash memory factories were hurt by the earthquake or tsunami.
The company's only chip factory in the area of the earthquake is in Kitakami City, Iwate prefecture, and produces logic chips, not memory chips. Production at the factory stopped as soon as the earthquake hit and it remains out of operation, Toshiba said.
The chip factories where Toshiba makes NAND flash memory are in Yokkaichi City, Japan, around 500 miles away from the earthquake's epicenter and the area hit by the tsunami.
"Two (factories) temporarily stopped operations on March 11, Japan time, but afterward resumed operation and are now operating normally," Toshiba said. "We are still carefully examining any possible impact on the production equipment caused by the earthquake but the effect so far is minimal."
Prices of DRAM, the most widely made memory chips used in PCs, laptops and servers, surged 7 percent after the earthquake was reported, according to market researcher iSuppli, and then settled down.
Elpida Memory, Japan's only major DRAM maker, has said its DRAM factories weren't affected by the earthquake. The company's main chip factory is in Hiroshima, in the southwest of Japan, well over 500 miles away from the earthquake.
While Japanese factories producing NAND and DRAM appear to have made it through the earthquake relatively unscathed, some of the world's largest suppliers of key materials used in chip production, such as the silicon wafers that chips are etched onto, have had to halt production.
- 15 Non-Certified IT Skills Growing in Demand
- How 19 Tech Titans Target Healthcare
- Twitter Suffering From Growing Pains (and Facebook Comparisons)
- Agile Comes to Data Integration
- Slideshow: 7 security mistakes people make with their mobile device
- iOS vs. Android: Which is more secure?
- 11 sure signs you've been hacked
- 4 Customers who never have to refresh their PCs again This paper illustrates a common theme: the combination of desktop virtualization and thin client computing helps organizations deliver an up-to-date user experience more...
- Mobile Devices: The New Thin Clients Get essential guidance for understanding the role thin clients plus virtual desktops play in the enterprise today.
- Taking Windows Mobile on Any Device Taking Windows applications mobile has many advantages, but the process of identifying a solution is complex. Learn how to solve this complex problem...
- PaaS - Powering a New Era of Business IT Why PaaS has suddenly become relevant and irresistible to many organizations. Dive into the opportunities and considerations associated with using PaaS from an...
- Redefine Your IT Operations: Remote Office IT Has Never Been Simpler Join us to see why PC Pro named Dell PowerEdge VRTX the "2013 Server of the Year." PowerEdge VRTX may be just what...
- Meg Whitman presents Unlocking IT with Big Data During this Web Event you will hear Meg Whitman, President and CEO, HP discuss HAVEn - the #1 Big Data platform, as well... All Hardware White Papers | Webcasts