Market watchers predict that the growth rate of the global memory chip market, which is led by Samsung Electronics and SK Hynix, this year will not be able to stand at less than a quarter of the last year’s. The market will continue to grow but the rate will be much slower than other years.
According to market research firm IHS Markit on January 1, the DRAM chip market is estimated at US$84.4 billion (89.97 trillion won) this year, up 16.9 percent from last year. Considering the fact that the DRAM market grew a whopping 74 percent to US$72.2 billion (76.97 trillion won) last year from a year ago, the annual market growth rate will be quartered in just one year.
The NAND flash market is also forecast to see its growth rate decrease. IHS said that the global NAND market will grow 10 percent from US$53.8 billion (57.33 trillion won) last year to US$59.2 billion (63.09 trillion won) this year. The figure falls far short of 46.2 percent of the last year’s growth. The market rapidly expanded from US$36.8 billion (39.22 trillion won) in 2016.
IHS has come up with the figures based on its analysis that the demand and supply conditions, which have been tight, will be improved. As the supply couldn’t meet the demand in the memory chip market last year, the price of memory chips surged. The constant price of 4-gigabyte DRAM chips rose 30 percent over the beginning of the year, while that of 128-gigabye NAND flash chips went up 25.8 percent.
However, the demand and supply conditions are expected to be better this year. This is because the supply can be expanded as South Korean memory chip producers are to improve their yield rates for advanced process, including 3D NAND chips, and Chinese firms have entered the market. The shipments will increase but the market growth will be lower with the average sales price (ASP) decreasing. The semiconductor industry predicts that the price of DRAM and NAND chips will gradually fall in the second half and the first half of this year, respectively.