Outlook for global chip market turns rosier: sources

By Yonhap
  • Published : Mar 12, 2018 - 09:48
  • Updated : Mar 12, 2018 - 09:48

The global semiconductor market is expected to grow at a faster-than-expected click this year thanks to rising demand for DRAMs and other chips, industry sources said Monday.

With concerns over an oversupply in the second half of this year waning, more market trackers have revised up their growth projections for the world chip market this year, putting shares of chipmakers on an upward curve.

According to the sources, a recent report from the World Semiconductor Trade Statistics has forecast global chip sales to rise 9.5 percent on-year to $451 billion this year.

The projection is higher than the 7 percent forecast presented by the WSTS in November last year.

Samsung Electronics Co.`s chip production line in Kiheung, south of Seoul. (Yonhap)

In a report released a week ago, the US Semiconductor Industry Association said global semiconductors sales spiked 22.7 percent from a year ago to $37.6 billion in January, maintaining the on-year gaining streak for 18 months on end.

Early this month, global investment bank Goldman Sachs said in a report to investors that the price of 32-gigabyte server modules had risen as high as 5 percent in just one month amid a global undersupply of DRAMs.

The report sent shares of US-based chipmaker Micron Technology Inc. soaring more than 10 percent in just three sessions.

Citing industry sources, Taiwan's IT daily DigiTimes reported Wednesday that global DRAM sales will spike more than 30 percent on-year to $96 billion this year, backed by increased demand for chips for data centers and smartphones.

The daily said DRAM prices will likely increase 5 to 10 percent in the first half of this year from a year earlier, with no price falls in the cards for the time being.

A South Korean industry source echoed the view.

"Demand for DRAMs used in servers and mobile devices will continue its upward momentum in the second half of the year," the source said. "In particular, Samsung Electronics and SK hynix will enjoy robust performances for the time being, given their dominant positions in the 3D NAND and DRAM technologies."

Another market watcher said global chip sales are likely to go up this year thanks to the growing size of the overall market, despite a possible drop in memory chip prices in the latter half of this year.

Yet, some skeptics said the world semiconductor market remains dogged by possible downside risks, such as China's massive spending on chip production and an excessive industrywide competition to cut prices. (Yonhap)