Micron has temporarily suspended operation of a DRAM production facility, leading to predictions of shortages and rising prices:
TrendForce reports that Micron suspended the operation of its Fab-2 DRAM production facility on June 1 due to a malfunctioning nitrogen gas dispensing system. Micron responded that while there was an event, it didn't involve nitrogen leaking. However, Micron's admission of a problem is telling, as TrendForce predicts the event will eliminate 5.5% of the global DRAM production capacity for July. Interestingly, the market analyst firm also claims this could lead to an impact on production for Apple's new iPhone.
The 5.5% output reduction may not sound like a significant event, but in the past, similar issues have served as the catalyst for massive shortages. This could exacerbate the ongoing DRAM shortage, which has already seen DRAM prices rise appreciably.
DRAM prices are on the rise due to slow transitions to new nodes and increased demand in PC, mobile, and server segments. TrendForce predicts that the first quarter of 2017 suffered a 30% increase in the average contract pricing for DIMM modules. Making matters worse, the soothsayer predicts that we will see another 10% increase this quarter, and that is before accounting for the recent production interruption.
Also at Reuters, which reports that Micron denies the event will affect its business:
"Regarding recent rumours about Micron's fabrication facility in Taoyuan, Taiwan, Micron hereby clarifies that there was no nitrogen leaking incident nor evacuating of personnel," Micron said in a statement. "There was indeed a minor facility event but operations are recovering speedily without material impact to the business."
[...] TrendForce analysts base their reports on channel checks in the supply chain, a media officer with TrendForce told Reuters.
It's the floods all over again!
Related Stories
IC Insights has predicted that DRAM prices will continue to increase this year:
According to IC Insights, DRAM prices will continue to increase even though they have more than doubled (+111%) over the last 12 months. IC Insights predicts that by the end of the calendar year DRAM's price per bit will have jumped a record 40% (or more).
[...] Of course, the record pricing levels are great for our friends at the major foundries. Samsung, Micron, and Sk Hynix are also raking in their own record profits and enjoying healthy margins. We have both DRAM and NAND shortages occurring at the same time, which is great for the foundries, and unless a player breaks ranks to gain market share, we can expect more foot-dragging before any of the foundries increases output.
The booming mobile industry and server markets are exacerbating the issue, so you would expect that the fabs would boost DRAM output. Unfortunately, the three primary fabs (Micron bought Elpida, reducing the number of players) don't share the same vision.
IC Insights indicates that Micron will not increase production capacity, instead relying upon improvements in yields and shrinking down to smaller nodes to boost its DRAM bit output. Sk Hynix has expressed its desire to boost DRAM output but hasn't set a firm timeline for fab expansion (unlikely to occur in the near term). Samsung is as tight-lipped as usual, so we aren't sure of its intentions.
In the 1980s there were 23 major DRAM suppliers, but cutthroat pricing and continual oversupplies eventually led to the wave of consolidation that left us with the current three suppliers.
Previously:
December 2015: DDR4 Memory Prices Declined 40% in 6 Months
May 2017:
DRAM Price Surge Continues
Samsung Set to Outpace Intel in Semiconductor Revenues
July 2017:
Micron Temporarily Suspends Operation of DRAM Production Facility
Samsung Increases Production of 8 GB High Bandwidth Memory 2.0 Stacks
August 2017:
DRAM Prices Continue to Climb
Samsung & SK Hynix Graphics Memory Prices Increase Over 30% In August
RAM has never been cheaper, but are the historic prices here to stay?
RAM prices are at historic lows. But it hasn't always been that way. If you upgraded your PC's memory in 2018, you might be kicking yourself right now. This writer certainly is. I upgraded from an old, faithful 16GB of 1,600MHz DDR3 to a 16GB kit of Corsair Vengeance RGB 3,000MHz DDR4. It cost me the equivalent of $200 at the time. That same kit today is just $75. What the hell happened? As of mid-2019, prices have finally gotten under control and are currently at an all-time low, making this a great time to upgrade. But is it here to stay?
[...] Ben Miles, managing director of award-winning British system builder Chillblast, explained that "more and more memory foundries [are focusing] on flash type memory to feed the insatiable smart device and mobile phone industries. Turning a DRAM factory into a flash factory or vice versa takes many weeks, so when companies have chosen their path, its[sic] non-trivial to turn it back. When demand outstrips supply, module vendors are forced to stockpile DRAM chips and offer more money to secure stock, driving up prices."
All of this led to a huge increase in RAM prices between 2016 and 2018. Gamers Nexus put together an in-depth report on this at the start of 2018 and showed the near 200 percent increases in price for some modules, both DDR3 and DDR4. Looking at PCPartPicker's historic trend graphs, we can see that early-2018 was the peak for RAM pricing, but that many speeds and kits took many months to even approach a noticeable fall in price throughout the year, only really falling hard in 2019.
[...] "We don't see the current low price of memory being the new normal," Ben Miles of Chillblast said. "As profits fall in DRAM due to abundance, factories switch focus back to flash, so we can expect peak demand in Q4 to see rising prices once again." [Corsair's public relations manager Justin Ocbina] was a little more hesitant to forecast price rises, but he did suggest that other industries were beginning to pick up the slack for the slowing smartphone market. That could lead to rising prices at some point in the near future.
There's also DDR5 to consider. We've heard a lot about the potential capabilities of this next-generation memory for years, and that's something that Corsair will be switching its attention to in the years to come. Ocbina said that from the get-go, it is expected to dethrone DDR4 from its premium, performance spot. That gap will only widen as more kits are launched following the new standard's debut.
"Historic" low prices (that are about the same per GB as in 2012 or 2015)? Nothing DDR5 and a flood, power outage, or nitrogen leak can't fix.
See also: Micron's DRAM Update: More Capacity, Four More 10nm-Class Nodes, EUV, 64 GB DIMMs
Previously: Expect 20-30% Cheaper NAND in Late 2018
Weak Demand for DRAM Could Lead to Price Decreases in 2019
DRAM Prices Will Continue to Decline in Q1/Q2 2019
Huawei Blacklisting Predicted to Cause DRAM Prices to Drop 15%
Related: Manufacturing Memory Means Scribing Silicon in a Sea of Sensors
(Score: 2) by JoeMerchant on Thursday July 06 2017, @11:17AM (5 children)
Since the NUC and similar form factors have come around, it's a lot easier to have 6-10 "PCs" at one's desk instead of just one or two.
🌻🌻 [google.com]
(Score: 2) by takyon on Thursday July 06 2017, @11:38AM
Internet of Terminals!
Increased demand is a bit of an optimistic interpretation. More like the PC market has stabilized (mostly) and may see a slight demand increase next year according to prognosticators:
Combined Handset, PC Shipments Expected to Decline [eetimes.com]
Worldwide PC shipments stabilise [opi.net]
PC bounce-back: Sales will rise for first time in seven years in 2018, says Gartner [channelweb.co.uk]
PCs will get pricier and you're gonna like it, say Gartner market shamans [theregister.co.uk]
[SIG] 10/28/2017: Soylent Upgrade v14 [soylentnews.org]
(Score: 2) by tibman on Thursday July 06 2017, @02:08PM (3 children)
Now is a great time to get into PC gaming too. Well, other than the crypto-miners blowing up the GPU market. But there is a much larger support system for beginners these days.
SN won't survive on lurkers alone. Write comments.
(Score: 2) by JoeMerchant on Thursday July 06 2017, @05:14PM (2 children)
Maybe I just don't care since my first "gaming console" was an Atari 800 playing "Star Raiders" but, seriously folks, aren't there enough time wasting titles out there that run on embedded graphics? I mean, 10 years ago embedded graphics were indeed rather dodgy for anything even as demanding as "Star Raiders," but since roughly Broadwell, the embedded graphics have been good enough for most things I try to play, and they are still improving with each generation.
Of course, I spent 3 hours this weekend playing StarCraft Anthology, so what do I know?
🌻🌻 [google.com]
(Score: 2) by tibman on Thursday July 06 2017, @06:44PM (1 child)
Oh, for sure. There are (mostly indie) games coming out every week that require very little graphics hardware. But if you want to experience something like Subnautica or Doom (2016) then more hardware will be required.
I think that's the great thing about the current state of gaming. Even niche genre's are getting more and more titles. Low-graphics is probably a kind of meta-genre.
SN won't survive on lurkers alone. Write comments.
(Score: 2) by JoeMerchant on Thursday July 06 2017, @09:37PM
From my perspective, today's "low graphics" are still far and away better than anything that was available when, oh, say Crysis came out, and I'm not talking about how Crysis runs on today's hardware, I'm talking about sub $10K machines and games that were available in 2007.
🌻🌻 [google.com]
(Score: 0) by Anonymous Coward on Thursday July 06 2017, @12:18PM
I saw it as "Macron", and thought "Who does this guy think he is?!"
(Score: 2) by Runaway1956 on Thursday July 06 2017, @01:45PM (5 children)
"it didn't involve nitrogen leaking"
Who knows what might have happened, if they were leaking NITROGEN into the air!! The last I heard, our atmosphere was already 78% nitrogen!
Oh, wait. They took that nitrogen out of the atmosphere to start with, didn't they? Ehhh - nothing to see here after all.
(Score: 5, Interesting) by DECbot on Thursday July 06 2017, @02:45PM (2 children)
It is actually astonishing how much Nitrogen these fabs produce for normal operations. I used to work as an onsite vendor rep (aka the warranty plan) at a Micron plant in the US. That site had 3 Nitrogen generation plants, two operating at 100% of capacity and a third plant somewhere around 20% of capacity. The equipment I worked on would dump 400 L/min to 1200 L/min of Nitrogen into the wafer loading area to keep the oxygen level less than 20 ppm. Any more than that and you'd risk adding an oxide layer forming on the surface of the wafer and inadvertently adding capacitors to the chip. That is just one piece of equipment, we had ~90 such furnaces in Diffusion and only supplied roughly half of the Diffusion furnaces for Micron. Diffusion was only about a sixth of the production floor. Pretty much every piece of equipment in the plant had Nitrogen ran to it as atmosphere was a yield killer at nearly every step of production. Additionally, Nitrogen is also used as a balance gas in production throughout the plant to ensure process chambers maintain the correct pressure for the chemical reaction occurring. If the output of the generation plant was large enough and in an enclosed space like a large building, it would be a serious suffocation hazard.
More likely, shareholders should be very worried about the viability of Fab-2. Any sort of leak would introduce vast amounts of foreign particles into their Nitrogen delivery system and cause massive defects and significantly drop yields at every step of production. My guess the fab had to be shut down to give enough time to repair, clean, and purge the Nitrogen delivery system. This will cost Micron tens of millions of dollars per day. Not just in operation and repair costs, but also from incomplete product sitting around in their FOUPs expiring. Once production starts again, it will be 3 month ramp until it is back to full production, and even then there will be lots of additional preventative maintenance required due to foreign materials in the production equipment and the extended down time. Honestly, the equipment runs better when it is left in production and never let to rest for more then then minimum time to perform routine PMs.
About the time I was leaving, Micron was starting a Nitrogen reduction program. They wanted to reduce the number of operating Nitrogen generation plants to 2 as it took about 1.2 Megawatts just to run a plant at minimum capacity. Bringing one plant offline would save them a bundle on there electric bill.
cats~$ sudo chown -R us /home/base
(Score: 2) by bob_super on Thursday July 06 2017, @05:52PM (1 child)
The best way to deal with the N2 supply is to remove the pesky humans who need O2.
Flood the floor with N2, make the whole place as airtight as possible, with positive pressure inside, and you need a whole lot less N2.
Why does anyone need humans in a factory anyway? They're always messy and expensive, and half of the gases used during Si production can maim or kill them on the spot (not counting another third which can blow up the whole place. Servicing the Gas Room under a clean room was interesting in a "don't improvise, don't fuck up, especially if it the screw is backwards" way).
(Score: 2) by DECbot on Thursday July 06 2017, @07:52PM
It would not surprise me if fabs start going that way. There's a few caveats that will make a N2 fab difficult:
So those are my quick thoughts. I'm sure these are solvable. Lights out manufacturing of semiconductors does sound pretty cool in the Skynet/Matrix sense.
cats~$ sudo chown -R us /home/base
(Score: 4, Informative) by Taibhsear on Thursday July 06 2017, @02:46PM (1 child)
I assume you're being facetious but for those that might not be aware, nitrogen leaks indoors are of serious concern. Nitrogen is odorless and displaces the oxygen in the room and because you're still getting rid of carbon dioxide in your lungs you don't notice you are suffocating and basically just get light headed and pass out. http://industrialplantsafety.com/dangers-of-nitrogen.html [industrialplantsafety.com]
(Score: 0) by Anonymous Coward on Thursday July 06 2017, @06:13PM
What a bunch of leftist climate change nonsense! Nitrogen is completely safe to breathe.