DRAM prices rise by 42 percent as SK Hynix tries resuming memory production

The effects of the fire on Hynix’s manufacturing plants are finally showing themselves. According to Bloomberg , smartphone and computer manufacturers are facing a rise in cost because memory chip prices have risen. The rise is a massive 42 percent one, and it is mostly because of the lack of Hynix as a major player in the memory market right now.

2 gigabit DDR 3 DRAM now costs $2.27 (Rs 142 approx), which is quite a bit when you compare it to its $1.60 (Rs 100 approx) price tag from earlier this month. Hopefully, SK Hynix expects to resume the production of its memory chips next month.

To curb the impact in its supply chain, Hynix boosted production in its other manufacutring plants. The rise in price will be seen as the year goes on because shipments from China are set to be higher than last year.

DRAM prices have risen dramatically (image credit: Bloomberg)

“Chip prices will continue to rise throughout the fourth quarter or at least there will be no drop until the operation gets into full swing,” Oh Sang Woo, a Seoul-based analyst at Leading Investment & Securities Co., said. “The market previously expected the price to peak out in the fourth quarter.”

The fires started at around 7:50 AM GMT on September 4 during what was supposedly a routine install of equipment. It spread quite quickly to other production facilities in the area. The fire itself was contained within two hours, but there was a considerable amount of damage done to both of the facilities.

The ramification of the fire was the almost-irreversible damage that had been done to these facilities. Making chips and silicon that are so small that they have to be measured at the nanometre scale is quite a precise science and needs a clean environment. The fire, and by extension the smoke, had caused a lot of damage to the facilities.