Many DRAM chip suppliers reportedly have stopped quoting their chip prices for the spot market segment following the earthquake which hit Japan on March 11. Meanwhile, downstream module firms have also demonstrated their reluctance to take large orders from distributors and traders to avoid excessive speculation in the DRAM market.
Taiwan's Powerchip Technology announced immediately after Japan's quake hit that it would discontinue offering quotes. Powerchip pointed out that it is necessary for the company to confirm how the earthquake would impact the industry's supply chain before it makes any price adjustments.
Powerchip still sells the majority of its DRAM chips on the spot market, as its contract agreement with Elpida Memory has not been finalized.
Samsung Electronics and Hynix Semiconductor have also followed suit, stopping providing price information, according to industry sources.
Several DRAM distributors have begun to place orders as they anticipate the quake could impact global DRAM production, the sources said. Though the distributors have identified minor damage to production at Elpida, they are more concerned about disruptions at silicon wafer suppliers Shin-Etsu and Sumco. Production at Shin-Etsu could be seriously affected as it produces most of its wafers in Japan.
It is still hard to determine weather DRAM supply memory will become tight, sources at module makers commented. However, chip producers are expected to limit their supplies to the spot market starting Monday March 14, the makers believe.
In other news, DRAM contract prices for early March were static despite the fact that several suppliers claimed to have raised their quotes, the makers indicated. However, prices are likely to increase over the short term as PC and system vendors are now more willing to negotiate new quotes with chip suppliers, the makers speculate.
Spot market prices for branded and effectively tested (eTT) 1Gb and 2Gb DRAM chips all trended upward during the morning trading session of March 14. Branded and eTT 1Gb DDR3 were traded at US$1.11 and US$0.96, respectively, up 6.8% and 6.7%.