Taiwan DRAM production value up 47.3% in Q3

Taipei, Dec. 15, 2003 (CENS)--Taiwan's DRAM (dynamic random access memory) industry reported total output value of NT$34.1 billion (US$1 billion at US$1:NT$34) last quarter, increasing 47.3% from the second quarter, according to a local market research organization.

Industrial Economics & Knowledge (IEK) Center of the government-backed Industrial Technology Research Institute (ITRI) attributed the hefty growth to seasonal factors, steadier DRAM prices and introduction of new capacities.

The center's study showed that local DRAM makers have increased production of double data rate (DDR) chips since the second quarter in line with Intel's high-profile promotion of DDR-compatible chipsets. In the second quarter, Taiwan's DDR DRAM output value reached NT$20.8 billion (US$612 million), accounting for 89.8% of the island's total DRAM output.

However, DDR production value slipped to account for 88.5% of Taiwan's total DRAM production in the third quarter as a result of increased production of the niche synchronous DRAM, which became more profitable than the staple DDR chips because of a cut in the number of suppliers. Synchronous-type chips generated a total output value of NT$3.87 billion (US$113.8 million) last quarter islandwide, accounting for 11.3% of Taiwan's DRAM production.

By memory-capacity specification, 256-megabite chips were the largest-volume item of Taiwan's DRAM industry last quarter with a total value of NT$30.3 billion (US$891 million), a 45.8% gain from the second-quarter's NT$20.6 billion (US$605.8 million). At the moment, 256Mb DRAM modules are the standard memory hardware built in personal computers.

Nevertheless, Taiwan's output of 256Mb DRAM chips slightly went down to represent 87.9% of Taiwan's total DRAM production last quarter from the second- quarter's 88.9%. The reason behind was that many DRAM makers increased 64Mb and 128Mb chip production to keep up with growing needs from DVD-player and DVD-burner suppliers.

On perspective of fourth-quarter revenue of the Taiwan industry, IEK's analysis is that the value will continue growing throughout this quarter mostly thanks to the addition of new production capacity and steady DRAM prices.

Although 256Mb chip prices have dropped to current US$4.5 apiece from a peak of US$6.5 quoted in July this year, IEK thinks the average price will remain at US$4 or so throughout this quarter. The organization pointed out that DRAM prices have trended downward despite recovering PC sales worldwide because of reduced procurements by OEM-based computer suppliers, which cut the procurements in order to squeeze out more money for the costly liquid-crystal display (LCD) panels and passive electronics components used in the computers.