Seoul 5 Aug : Demand for DRAM is expected increase at a previously low level this year, a report revealed, with a dim prospects for South Korean chipmakers, heavily dependent on sales of memory chips to boost their profits.Research firm for industry TrendForce forecasts DRAM market demand and growth will be 8.3 percent in the next year.This is a decrease of less than 10 percent for the first time in the history of DRAM.
TrendForce stated that supply is expected to increase by 14 percent, indicating that the DRAM market is “severely over-supplied” and “prices continue to fall for many.”
Bit growth refers the amount of memory created and is regarded as a crucial indicator to determine the demand for market according to Yonhap news agency.
The research firm stated that NAND Flash will fare better due to its “built-in price elasticity that is comparable to DRAM, and its average costs are anticipated to spur the growth of density in the enterprise SSD market following a drop over a number of quarters.”
For NAND flash demand, it is expected to rise by 28.9 percent, while supply is expected to increase by 32.1 percent according to the report.
DRAM, also known as dynamic random-access memory, is a form of in which a semiconductor is volatile, and can store data for as long as electricity is provided.It is widely employed in laptops, personal computers, and servers.
NAND flash is a form of non-volatile storage device that doesn’t require electricity to store data.
TrendForce stated that memory chip makers are currently focusing on adjusting their inventories since rising inflation continues to dampen demand from consumers which is causing prices for memory chip to drop.
For Samsung the world’s largest memory chip maker the chip business made about 70% of its operating profits in the three months that ended in June.
In its earnings conference last week, Samsung forecast that demand for servers’ chips will remain strong, but warned that there is a chance that customers of servers could reduce orders to reduce inventories due to global uncertainty.
SK hynix the world’s second largest manufacturer of memory chips, warned that demand for semiconductors could be slowed in the second halfof the year, especially for chips that are used in smartphones and personal computers.
Samsung was the leader in the DRAM market with the highest share of 42.7 percent market share in the first quarter of this year, followed by SK Hynix, which had 27.1 percent.For the NAND flash market, Samsung was No.1 with an 35.5 percent share, and SK Hynix came in third place with 18.1 percent according to research company Omdia.
na/
