There is an outlook that prices will rise next year due to shortages in general-purpose DRAM and NAND flash. This is because Samsung Electronics, SK hynix, and Micron are focusing on expanding production capacity for high bandwidth memory (HBM), where demand is surging with the growth of the artificial intelligence (AI) industry. NAND flash is also expected to see supply fall short of demand as replacement demand for solid-state drives (SSD) increases, centered on AI data centers.
According to the industry on the 16th, the supply resulting from next year's capacity expansion by memory semiconductor corporations will likely fail to meet increasing demand for memory semiconductors. iM Securities projected next year's DRAM production capacity (capex) growth at 13.5% and NAND flash at 13.9% compared with this year. In contrast, it forecast demand growth over the same period at 13.7% and 14%, respectively. Mirae Asset Securities expected DRAM and NAND flash demand to rise 12% and 18% next year, but analyzed that capacity growth would be only 6.5% and 0.6%, respectively.
There is analysis that the capacity expansion by Samsung Electronics, SK hynix, Micron, and others being concentrated on HBM is the cause of the shortage in general-purpose DRAM supply. Although DRAM production lines are being expanded, a significant portion of the mass-produced output is presumed to be used for HBM manufacturing. Kim Dong-won, a KB Securities researcher, said, "In the case of general-purpose DRAM, demand centered on servers is exceeding expectations, but the three DRAM companies (Samsung Electronics, SK hynix, Micron) are focusing only on expanding HBM production capacity and are not considering additional new expansions beyond process conversions," adding, "General-purpose DRAM supply is tightening, and a supply shortage in next year's DRAM market is expected."
The situation is similar for NAND flash. Demand for existing hard disk drives (HDD) and SSDs is accelerating, centered on AI data centers. Meanwhile, HDD supply is also tightening, and replacement demand for SSDs, which outperform HDDs, appears to be increasing. Storage devices typically used in AI data centers have been dominated by HDDs, but as AI technology advances, demand for NAND flash-based SSDs with faster write and read speeds is growing, centered on cloud corporations.
Han Dong-hee, an SK Securities researcher, said, "HDDs have been reorganized into a structure where Seagate and Western Digital lead supply. Given the structure of long-term supply contracts with clients, it is difficult to see changes in supply conditions in the short term."
For these reasons, there is an outlook that prices of general-purpose memory semiconductors will rise. Kim Young-gun, a Mirae Asset Securities researcher, said, "Due to the limited supply by (memory semiconductor corporations), memory semiconductor prices are expected to rise next year," adding, "Capacity expansion has been limited due to uncertainty in demand for general-purpose memory semiconductors, and even that has been concentrated in HBM."
Recently, signs of memory semiconductor price increases have emerged, centered on some corporations. SanDisk, a NAND flash corporation, reportedly notified clients in early this month that it will raise prices of NAND flash products by 10%. Micron recently halted all "quote submissions" to clients and is said to have notified them of price increases of more than 20% for some general-purpose DRAM such as DDR5. A semiconductor industry official said, "With steady supply of the highly profitable HBM, an upward trend in general-purpose memory semiconductor prices is being detected."