Chip prices staying on upward path

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Chip prices staying on upward path

With prices of dynamic random access memory chips rising, analysts are predicting the long slide in semiconductor chip prices is over. Following a more than three-month decline, the average spot price yesterday of the industry standard 256 megabit double data rate chip that runs at 266 megahertz was $3.45, the same as Monday’s price. The spot price of these chips hit $3 on March 4 and has been on a constant ascent since then. The spot price of the 256 megabit DDR chips hit $9 in early November last year. But seasonally slow sales and dumping by memory chipmakers, an industry practice conducted in the hope of picking them up later at a discount, weighed on prices, which fell to an average of $5.20 in January, and $3.39 in February. On Feb. 18, chip prices dipped below $3, and on Feb. 26, they plummeted to the record low of $2.86. The rebound of chip prices was attributed to companies trying to stock up DRAM chips over concerns that the supply might be disrupted if a war breaks out between the United States and Iraq. Further buoying the market was optimism that Intel’s introduction of new chips slated for late March would boost demand for new personal computers. But officials at Samsung Electronics, the largest memory chipmaker in the world, were weary on such optimism. “Unlike the spot prices that are on the rebound, contract prices with large customers are still on the decline,” a Samsung official said. “It is still too early to predict a long-term recovery.” by Kim Hyo-jin
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