Memory Bank go up Obviously in 2019, Samsung Cuts Memory Capacity by 28%
The price of memory soars obviously in 2019. Manufacturers seem to take actions due to so many international factors. Inside news of the industry came that Hynix increased the price of some products of NAND Flash.
Samsung, SK hynix and Micron monopolize 95% of the memory capacity in the global market. Their profits have been crippled by the weak memory market. For example, the profit of Samsung was predicted to slump over 50% in the last quarter. They have adjusted the supply and demand in capacity because they won’t lay aside the falling price of memory.
International Semiconductor Industry Association has lowered the budget on the devices of global wafer plants in 2019 from 14% to 19%. The association believed that the price will rebound，and be expected to increase by 20% in a year.
On the other hand, the capital expenditure in 2020 will be lower than this year, said Micron in the last earning meeting. Th capital expenditure of DRAM market in 2019 will be lowered sharply. It is predicted to be $17billion for the whole year, an increase of 28% than 2018. It registered $24 billion last year, an increase of 50% than the $16 billion in 2017. Therefore, the supply and demand will decline accordingly due to the declining capacity.
Micron has revealed its concrete plan to cut capacity, namely, to cut capacity by 5%, and to subtract that of NANA flash memory from 5% planned before to 10%. Samsung has denied its plan to reduce the capacity of NAND flash memory, however, it struggles when semiconductor materials are in short supply. There are 19 materials used in semiconductor crafts. Japan with 14 account for the market share over 50%. Samsung struggles to maintain the capacity.
IC Insight predicted on the price trend that uncertainty of the global trade remained this year, therefore, the price of memory remained weak in the second half of this year. While the supply and demand of DRAM memory in 2020 will strike a balance because companies reduce the capital expenditure of 2019 sharply, which is conducive to reduce the stock.
Insiders said that major manufacturers have increased the price by 10%. Changes have taken place in the market price of flash memory card and USB Drive since TOSHIBA suffered power failure. The price of flash memory cards has tended to increase since the end of June, and quite a few manufacturers said they have started to demand for flash memory cards since July. Nevertheless, the mark - up two years ago will not happen again because it was predicted that the price would not keep increasing for long.