Micron's Japanese Factory Power Outage Impact Minimal... "DRAM Price Decline to Continue"

[Image source=Yonhap News]

[Asia Economy Reporter Park Sun-mi] The semiconductor industry largely expects that the shutdown of Micron's Hiroshima plant in Japan, the world's third-largest memory semiconductor company, due to a power outage will not cause significant disruption.

On the 16th, market research firm TrendForce stated, "The impact of the power outage on Micron's production capacity is relatively low," adding, "Micron can respond to its customers using accumulated inventory, so there is no effect on the overall DRAM market supply and demand situation."

They also noted, "No significant changes have been detected in the spot market following the power outage at Micron's plant," and added, "The current memory oversupply situation is unlikely to be reversed. We maintain our previous view that DRAM prices will fall by about 10% in the third quarter."

On the 12th, Micron announced that a prolonged power outage occurred at its Hiroshima DRAM manufacturing plant, causing a halt in operations. The outage lasted approximately 5 to 10 minutes, and Micron resumed operations with a reduced production line. The losses caused by the outage are planned to be reflected in the fourth quarter of this year and the first quarter of next year.

Industry insiders estimate that Micron's Hiroshima plant has a monthly production capacity of 115,000 wafers, accounting for about 7% of the global DRAM production capacity. However, since the power outage was brief and due to the ongoing effects of inflation since the beginning of the year and the Russia-Ukraine war, global demand for IT devices and home appliances has been sluggish, leading to high memory inventory levels.

In the securities sector, given the sufficient inventory levels of memory semiconductors, it is widely believed that Micron's recent incident will not bring any significant windfall benefits to Samsung Electronics and SK Hynix, the top two companies in the memory semiconductor sector.

This content was produced with the assistance of AI translation services.