More memory price increases blamed on Taiwan earthquake, but hikes were happening months before, and major manufacturers aren't based in Taiwan

Samsung
(Image credit: Samsung)

TrendForce reports that major players in the memory space, including Micron, Samsung, and Western Digital, are all announcing price hikes for their memory products. The reasons behind the price increases differ from manufacturer to manufacturer, with the recent Taiwan earthquake getting at least some of the blame. Micron's production facilities sustained damage during the quake, though Samsung seems to be specifically targeting the enterprise and AI markets with their price hikes.

The 7.2 magnitude earthquake that hit Taiwan on April 3, 2024, was the largest tremor in that region in 25 years, resulting in destruction across the island. Micron's production lines were damaged by the quake, and in the immediate aftermath of the disaster Micron halted much of their production, causing speculators to worry about potential damages. The damages mostly occurred on more advanced processes used for server DRAM rather than consumer-grade NAND lines for SSDs and flash drives, so the earthquake likely isn't entirely to blame for Micron's price increases.

Taiwanese media reports Micron has increased prices by over 20% in recent months, though TrendForce expects the actual increase for mobile DRAM to be in the 3–8 percent range compared to the previous quarter. Supplies for Micron's consumer products remain high, and it's thought that any earthquake-related emergency price increases should have gone back to normal by now. TrendForce reports other factors indicate that Micron's DDR4/DDR5 products have weak demand with no external factors driving prices up, leaving no market-based explanation for their announced Q2 price hikes.

Samsung is raising prices as well, specifically for its enterprise SSDs that are expected to increase by 20–25 percent in Q2 2024. Rumors suggest there's a shortage of enterprise SSDs right now. This would make sense, as enterprise SSDs are speculated to become a key component for AI use cases. Supplies of GPUs are the primary component in AI computing and have been plagued with supply constraints. Samsung, who already focuses on the AI market with its SSDs, are likely to continue targeting this hungry market with furious price increases. And as the owners of more than 40% of the enterprise SSD market share, Samsung's price decisions will affect the rest of the industry.

Western Digital is also reportedly raising its prices for both HDDs and NAND flash products, citing supply shortages of both on April 8. WD claims that supply has far exceeded demand for both classes of product, and that it's unable to keep up at current rates — rates that were intentionally reduced last year. Some prices will continue to adjust as the quarter continues.

These widespread price hikes follow increased industry-wide demand, and show a concerning trend among memory manufacturers. US-based companies like Micron and Western Digital are seeing significant declines in revenue and executive compensation year to year, not something we would expect to see if the reason for their price hikes was simply corporate greed. Most memory manufacturers are targeting a low production strategy to keep their demand artificially high, but the hits keep coming regardless, and the recent earthquake appears to be one more potential excuse.

Last year saw the lowest prices ever on DRAM and NAND, and memory manufacturers were losing money. While prices are trending up, there are still plenty of deals on SSDs and hard drives, with high capacity and high performance 2TB and 4TB SSDs still quite affordable at present. However, if you're planning on growing your storage stable, you may want to act sooner than later.

Freelance News Writer
  • Order 66
    This doesn't surprise me, companies always blame price hikes on everything but corporate greed.
    Reply
  • Udyr
    Yeah... those estimations were way off.
    Reply
  • JTWrenn
    The market has become so manipulated. We need more fabs and more players to fight over market share instead of colluding on price. Samsung is too dominant in this market right now. Fabs are turning into the new OPEC, and we need to break that now before it gets worse.
    Reply
  • _Shatta_AD_
    JTWrenn said:
    The market has become so manipulated. We need more fabs and more players to fight over market share instead of colluding on price. Samsung is too dominant in this market right now. Fabs are turning into the new OPEC, and we need to break that now before it gets worse.
    And yet… USA is trying to kill SMIC, YMTC and other potential competitors off to maintain industrial monopoly and profit for their minion companies so they can continue to capitalize on our wallets and hard earned cash. What beats me is all these citizens continues to cheer on these tactics knowing their bottom lines will get marginalized. Then they protest about all these price hikes as if they don’t understand this very simple logic.
    Reply
  • t3t4
    Nope! It costs no more today than yesterday to make the same chip. $50 per TB is my buy number for SSD's, hit that number and we can be friends. Keep artificially jacking the price and I'll make them choke on their overstocked chips. You control of the market folks.
    Reply
  • pug_s
    _Shatta_AD_ said:
    And yet… USA is trying to kill SMIC, YMTC and other potential competitors off to maintain industrial monopoly and profit for their minion companies so they can continue to capitalize on our wallets and hard earned cash. What beats me is all these citizens continues to cheer on these tactics knowing their bottom lines will get marginalized. Then they protest about all these price hikes as if they don’t understand this very simple logic.
    I doubt SMIC and YMTC has much to do with the price increase. The memory made by the Chinese companies are mostly for local consumption and they are trying to establish themselves because national security reasons IE Trade bans.

    Bigger players Samsung and Hynix are in the export market and they are bigger manipulators of the market. Also, sdram and recently nand prices are mostly dictated not by supply and demand, rather than underproduction and overproduction cycles. In 2023 these same sdram and nand companies lost money because they are selling chips as a loss and now these chip companies are recovering with the price increase.
    Reply
  • JTWrenn
    _Shatta_AD_ said:
    And yet… USA is trying to kill SMIC, YMTC and other potential competitors off to maintain industrial monopoly and profit for their minion companies so they can continue to capitalize on our wallets and hard earned cash. What beats me is all these citizens continues to cheer on these tactics knowing their bottom lines will get marginalized. Then they protest about all these price hikes as if they don’t understand this very simple logic.
    In the end China's ip stealing and manipulation are what caused that. If china wasn't so aggressive in the south china seas, and if they were not stealing Ip, using slave labor, and manipulating the market it wouldn't be an issue.

    Don't get me wrong, the USA will always look out for themselves, but China is not playing fair when it comes to international law and making their own tech. They have been allowing IP theft for years, and pushing for it.

    I do agree that the USA and western countries in general are bad at competition every 100 years we seem to completely break it by giving up on anti trust....but China is even worse on that. So while it would be nice to have other major players, China is at least the driver of these issues not the USA even though everyone deserves crap for bad anti trust laws.
    Reply
  • _Shatta_AD_
    JTWrenn said:
    In the end China's ip stealing and manipulation are what caused that. If china wasn't so aggressive in the south china seas, and if they were not stealing Ip, using slave labor, and manipulating the market it wouldn't be an issue.

    Don't get me wrong, the USA will always look out for themselves, but China is not playing fair when it comes to international law and making their own tech. They have been allowing IP theft for years, and pushing for it.

    I do agree that the USA and western countries in general are bad at competition every 100 years we seem to completely break it by giving up on anti trust....but China is even worse on that. So while it would be nice to have other major players, China is at least the driver of these issues not the USA even though everyone deserves crap for bad anti trust laws.
    I’m not saying IP theft should be condoned or nurtured but by you logic, if every car companies MUST legitimately re-invent the wheel from scratch, then I’m afraid the competition that you hope for may Never come as the company who owns the patent will always be ahead. The only way there’s competition is if multiple companies catches up and must innovate in order to stay in the game. China is just arriving at that innovation junctions where it MUST go from copying to innovating and right then someone tries to remove her from the competition. Well maybe it’s a good thing, as it’ll force China to innovate earlier but as consumers, we’re quite unlucky to be caught in this era
    Reply
  • _Shatta_AD_
    pug_s said:
    I doubt SMIC and YMTC has much to do with the price increase. The memory made by the Chinese companies are mostly for local consumption and they are trying to establish themselves because national security reasons IE Trade bans.

    Bigger players Samsung and Hynix are in the export market and they are bigger manipulators of the market. Also, sdram and recently nand prices are mostly dictated not by supply and demand, rather than underproduction and overproduction cycles. In 2023 these same sdram and nand companies lost money because they are selling chips as a loss and now these chip companies are recovering with the price increase.
    YMTC actually was about to go global with their 3D NAND and in-house controller until US stop them from purchasing more fab equipment to increase output. They have no choice but to scale back production to meet only domestic demand for the time being. Had they gone global, other players would be less inclined to cut back NAND production or not cut back as drastically. Even if they did, YMTC would not, and that would at least stabilize supply hence cost to some extent.
    Reply
  • JTWrenn
    _Shatta_AD_ said:
    I’m not saying IP theft should be condoned or nurtured but by you logic, if every car companies MUST legitimately re-invent the wheel from scratch, then I’m afraid the competition that you hope for may Never come as the company who owns the patent will always be ahead. The only way there’s competition is if multiple companies catches up and must innovate in order to stay in the game. China is just arriving at that innovation junctions where it MUST go from copying to innovating and right then someone tries to remove her from the competition. Well maybe it’s a good thing, as it’ll force China to innovate earlier but as consumers, we’re quite unlucky to be caught in this era
    I'm sorry that is jut not what IP means. No we shouldn't hold them accountable for making EVs because someone else made them first, but if they stole the software/hardware schematics and then used them to get a leg up the whole product is tainted.

    It's not that they are copying, it's that they are stealing the inner workings and information directly. Seeing a car, and looking at it and poking around in it them immitating it with your own style is fine....but if you steal all the work done in the background, all the schematics, all the troubleshooting, and you match it identically, or so close then just paint it different...it's theft. The definitions are clear.

    The real issue with competition is both IP theft being a false illegal competition, and anti trust laws failing to allow small corps to come up while the big guys are trying to stomp on them. It has failed because the big guys are way way too big and can stomp them so effectively. China should have to build up their internal knowledge of these things, or pay for the products. Not steal the knowledge and create knockoffs, or their own products based on things that are patented.
    Reply