As a strike at the Samsung Electronics institutional sector (semiconductor) becomes more likely, some say it could become a second catalyst that sends surging DRAM and NAND flash prices soaring even higher. Major market research firms earlier projected that contract prices for memory in the second quarter would post the largest jump on record. Analysts say the supply risk of a strike overlapping with the entry into the peak phase could amplify the market shock more than expected.
According to the industry on the 15th, a scenario is emerging that the strike risk at the Samsung Electronics semiconductor union will deliver a second shock to this year's memory semiconductor price cycle. Until now, domestic and overseas market research firms and investment banks expected DRAM and NAND flash prices to peak in the third quarter and gradually stabilize starting in the fourth quarter. But the strike risk following the breakdown of labor-management talks at Samsung Electronics has emerged as a new variable.
The previous day, the Samsung Electronics semiconductor union rejected management's proposal for additional talks, creating an atmosphere that effectively leads to a strike. In response, key customers of Samsung's semiconductor business are understood to have begun preemptive steps to mitigate risk. A semiconductor industry official said, "Regardless of whether a strike happens, the situation itself is a psychological factor pushing up DRAM and NAND prices," and added, "It is making big tech companies and PC and smartphone makers, already suffering from a memory shortage, even more desperate."
According to major foreign media, key customers of Samsung's semiconductor business, including Apple and HP, have inquired about the impact of a strike, and high-bandwidth memory (HBM) customers are also watching whether a strike occurs. Samsung Electronics is trying to calm concerns by telling major customers it will ensure "no disruptions to supply," but some customers still worry about production disruptions from a strike and further increases in DRAM and NAND prices.
Kim Dong-Won, head of research at KB Securities, said the strike risk at Samsung's semiconductor business is "like pouring oil on a burning market." The global memory market has entered a phase of a "structural supply cliff," with supply unable to keep up with exploding demand for artificial intelligence (AI) infrastructure. As a significant portion of DRAM output from Samsung Electronics and SK hynix is concentrated in HBM for AI servers, supply of commodity DRAM and NAND has decreased, and U.S. big tech firms are even offering large advance payment terms to expand AI data centers.
According to KB Securities, if 30% to 40% of Samsung Electronics semiconductor union members join a strike, the global supply disruption is estimated at 3% to 4% for DRAM and 2% to 3% for NAND. While the ratios may not look large, experts say in the current shortage such levels could become a decisive catalyst for price spikes. Global DRAM inventories are understood to cover only four to six weeks of demand.
This could extend the peak phase of memory prices beyond earlier projections. Previously, major overseas investment banks and market research firms based their supply-demand outlooks on a scenario in which DRAM and NAND prices would peak in the third quarter and gradually stabilize starting in the fourth quarter. But if a Samsung Electronics semiconductor strike materializes, the peak could be pushed to after the fourth quarter, with additional impact on consumer-perceived prices, analysts say. TrendForce projects the memory shortage will continue through 2027.