DRAM Spot Market:

The spot market has not changed noticeably from the previous week and still lacks significant demand momentum. Therefore, spot prices of DDR4 and DDR5 chips have maintained a mostly flat to slightly downward trend. Module houses also hold a conservative demand outlook, so they have yet to actively raise the spot prices of their products.

Currently, the overall price trend remains steady due to suppliers’ efforts to limit supply and prop up prices. However, more chips will be released into the spot market in 2Q24. This supply increase will be especially noticeable for DDR5 products, and spot prices, on the whole, will probably weaken as a result. The average spot price of the mainstream chips (i.e., DDR4 1Gx8 2666MT/s) fell by 0.05% from US$1.940 last week to US$1.939 this week.

NAND Flash Spot Market:

Despite enervation from end demand, quotations for NAND Flash wafers and other related products have yet to loosen under the stimulation generated by the ongoing increment of contract prices, and prices are still somewhat being supported on the whole. Additionally, provision from suppliers has not expanded significantly, where overall price dynamics are slightly better than that of DRAM spots. 512Gb TLC wafer spots have risen by 8.26% this week, arriving at US$3.840.

According to a report by the South Korean news outlet The Chosun Daily, Samsung Electronics’ memory business has managed to endure the market downturn from last year. Recently, its strategy of reducing production has finally paid off, driving up chip prices.

Reports suggest that in the first quarter of this year, Samsung plans to raise NAND Flash chip prices by up to 20%, aiming to restore profitability to its memory chip business.

The report quotes a semiconductor industry source as saying, “The first-quarter price negotiations between major memory manufacturers such as Samsung Electronics and SK Hynix and their customers have not yet been concluded. However, customers are rushing to secure supplies as the price of NAND flash has been steadily increasing, and fears spread that NAND flash cuts will continue this year.”

As per the report citing sources, Samsung Electronics will renegotiate prices with major mobile, PC, and server customers in March and April this year. It is expected to push for a price increase of 15 to 20%.

As per a report from Commercial Times, the global economic downturn last year led to an oversupply of memory and a sharp decline in prices, resulting in severe losses for Samsung and SK Hynix’s memory businesses. Samsung’s memory division experienced its first-ever losses last year, dragging down the company’s overall profits to a new low.

Samsung, Micron, and SK Hynix, the three major players in the memory industry, began significant production cuts in the second half of last year, finally causing DRAM chip prices to rebound. However, the NAND Flash chip market is crowded with many manufacturers, including not only the three major players but also Japanese Kioxia and American Western Digital, leading to less significant effects from the production cuts.

Last year, Samsung’s NAND Flash chip business incurred operating losses of KRW 11 trillion (approximately USD 8.3 billion), while SK Hynix’s NAND Flash chip business also faced operating losses of 8 trillion Korean won. Since the second half of last year, the aforementioned companies have halved their production capacities, finally pushing NAND Flash prices up.

Per TrendForce’s data, NAND flash prices have increased for five consecutive months. TrendForce research previously indicated that despite facing a traditional low-demand season, buyers are continuing to increase their purchases of NAND Flash products to establish safe inventory levels. In response, suppliers, aiming to minimize losses are pushing for higher prices, leading to an estimated 15–20% increase in NAND Flash contract prices in 1Q24.

Currently, the NAND Flash market is still dominated by the five major manufacturers, with Samsung and SK Hynix accounting for the lion’s share.

Samsung still firmly held the top position in the NAND Flash market, with its market share increasing from 31.4% in the previous quarter to 36.6%; next was SK Group, with its market share increasing from 20.2% in the previous quarter to 21.6%.

Following them were Western Digital, whose market share decreased from 16.9% in the previous quarter to 14.5%, Kioxia, whose market share decreased from 14.5% in the previous quarter to 12.6%, and Micron, whose market share decreased from 12.5% in the previous quarter to 9.9%.

Read more

• [News] NAND Flash Market Landscape to Change?
• NAND Flash Contract Prices Forecast to Rise 15–20% in 1Q24 Thanks to Supplier-Led Pricing, Says TrendForce

(Photo credit: Samsung)

With the rising demand in the memory market and Chinese memory companies actively preparing for competition, a report from TechNews indicates that Zhou Meisheng, formerly the assistant to SMIC’s co-CEO Liang Mengsong, has joined ChangXin Memory Technology (CXMT) as the head of the Technical Research and Development Center, attracting attention.

Zhou Meisheng has previously served as the CTO of Lam Research in China, a global research and development equipment technology company. Before that, she held positions in various semiconductor companies, including Chartered Semiconductor (Singapore), UMC, and GlobalFoundries.

Starting in 2017, she served as the Executive Vice President of R&D at SMIC, directly reporting to co-CEO Liang Mengsong. She played a crucial role as Liang Mengsong’s key assistant in driving SMIC’s advanced process initiatives. In 2022, Zhou Meisheng retired, resigning from all positions at SMIC, sparking speculation.

The technology of CXMT continues to make breakthroughs, and by the end of 2023, the official website of CXMT announced the development of China’s first LPDDR5 DRAM chip. They introduced a series of LPDDR5 products, including 12GB LPDDR5, 12GB LPDDR5 with POP packaging, and 6GB LPDDR5 with DSC packaging.

LPDDR5 represents the fifth generation of low-power DRAM, and compared to the previous LPDDR4X, the new LPDDR4X has a 50% increase in capacity and speed, reaching 12GB capacity, a data transfer rate of 6,400Mbps, and a 30% reduction in power consumption.

In fact, CXMT’s main competitor Samsung announced the mass production of 12GB LPDDR5 mobile DRAM in July 2019, while Micron supplied LPDDR5 DRAM with capacities of 6GB, 8GB, and 12GB in February 2020. SK Hynix, on the other hand, announced the mass production of 18GB LPDDR5 mobile DRAM in August 2021. Therefore, considering the timeline, there’s an approximate four-year technology gap between CXMT and other global giants.

As for the DRAM market, it currently remains highly concentrated, dominated by key players such as Samsung Electronics, SK Hynix, and Micron Technology, collectively holding over 96% of the entire market share.

Read more

• [News] SMIC’s Net Profit Halved Last Year, Faces Further Reductions This Year
• [News] CXMT’s LPDDR5 Release Fuels in Chinese Memory Market, Spotlight Progress of Global Memory Giants

(Photo credit: CXMT)

According to sources cited in Bloomberg’s report, the US government is considering imposing sanctions on Chinese technology firms, including ChangXin Memory Technologies (CXMT), in its latest move against China’s advanced semiconductor sector.

The same report has pointed out that the US Department of Commerce’s Bureau of Industry and Security (BIS) is currently considering including CXMT in the Entity List, which would restrict the listed companies’ access to US technology. Apart from CXMT, US officials are also contemplating restrictions on five other Chinese companies, though the final list has yet to be confirmed.

Regarding this matter, the BIS and White House National Security Council declined to comment.

CXMT is a major Chinese DRAM manufacturer whose products include chips applicable in computer servers, smart vehicles, and other devices. Its primary competitors include Micron, Samsung Electronics, and SK Hynix. Micron.

The recent actions by the US government reportedly stem from Huawei’s breakthrough last year in circumventing US restrictions to acquire advanced process chips, specifically obtaining chips using the 7-nanometer process from SMIC (Semiconductor Manufacturing International Corporation). This allowed Huawei to make a comeback in the 5G smartphone market, prompting concerns and responses from the US government.

Gina Raimondo, the US Secretary of Commerce, has responded by stating that the US will take “as strong and effective action as possible” to uphold national security interests.

Currently, companies that have been listed on the Entity List by the US Department of Commerce include Huawei, SMIC (Semiconductor Manufacturing International Corporation), and Shanghai Micro Electronics. Additionally, China’s other major memory manufacturer, Yangtze Memory Technology Corp, was added to this restriction list in 2022.

Read more

• [News] Bypassing U.S. Restrictions? CXMT Showcases GAA Technology for 3nm Chips
• DRAM Industry Sees Nearly 30% Revenue Growth in 4Q23 Due to Rising Prices and Volume, Says TrendForce

(Photo credit: CXMT)

South Korean memory giant SK Hynix is reportedly exploring a collaboration with Japanese NAND flash memory manufacturer Kioxia to produce High Bandwidth Memory (HBM) for AI applications, as per MoneyDJ citing Jiji Press.

According to Jiji Press’ report on March 1st, it is estimated that production will take place at the Japanese plant jointly operated by Kioxia and Western Digital (WD). Kioxia, on the other hand, will evaluate the proposed collaboration based on semiconductor market conditions and its relationship with WD.

The report highlights that HBM, a type of DRAM primarily used in AI servers, is experiencing a surge in demand worldwide, led by NVIDIA. Moreover, according to a previous TrendForce press release, the three major original HBM manufacturers held market shares as follows in 2023: SK Hynix and Samsung were both around 46-49%, while Micron stood at roughly 4-6%.

For SK Hynix, leveraging Kioxia’s existing plants in Kitakami, Iwate Prefecture, and Yokkaichi, Mie Prefecture, Japan, to produce HBM would enable the rapid establishment of an expanded production system.

Meanwhile, the joint-operated Japanese plants of Kioxia and WD currently only produce NAND Flash. If they were to produce the most advanced DRAM in the future, it would also contribute to Japan’s semiconductor industry revitalization plan.

The report further addresses that SK Hynix has indirectly invested approximately 15% in Kioxia through Bain Capital, a U.S.-based investment firm. Bain Capital is reportedly negotiating with SK Hynix behind the scenes, seeking to revive the Kioxia/WD merger. However, as per sources cited in Jiji Press’ report, “this collaboration and the merger are two separate discussion matters.”

According to a previous report from Asahi News on February 23, Kioxia and WD are expected to restart merger negotiations at the end of April. Although the merger negotiations between the two parties hit a roadblock last autumn, both are facing pressure to expand their scale for survival. However, whether the two parties can ultimately reach a merger agreement remains uncertain.

As per TrendForce’s  data for 3Q23, Samsung maintained its position as the top global NAND flash memory manufacturer, commanding a significant market share of 31.4%. Following closely, SK Group secured the second position with a 20.2% market share. Western Digital occupied the third position with a market share of 16.9%, while Japan’s Kioxia held a 14.5% market share.

Asahi News further indicates that if Kioxia and WD, the 2 companies which all manufacture NAND Flash products are to merge, their scale will rival that of the global market leader, Samsung Electronics.

The Japanese government reportedly views the Kioxia/WD merger as a “symbol” of Japan-US semiconductor cooperation and has provided support. However, the merger negotiations hit an impasse last fall, reportedly due to opposition from SK Hynix, indirectly invested in Kioxia.

Read more

• [News] NAND Flash Manufacturers Kioxia and WD Reportedly Set to Resume Merger Talks in Late April
• [News] Kioxia and Western Digital Resume Merger Negotiations? Rumors of Bain Negotiating with SK Hynix Surface

(Photo credit: Kioxia)