Micron Sees One Or More Hikes In DRAM Contract Prices
By MARK BOSLET
September 27, 1999
Dow Jones Newswires
PALO ALTO, Calif. -- Makers of computer memory chips continued to be able to charge more for their products in both the spot and contract markets, Micron Technology Inc. (MU) said.
Meanwhile, investments to expand production capacity in the industry aren't keeping pace with the anticipated increase in demand, company spokesman Kipp Bedard said.
Micron sketched out this upbeat industry scenario at the Bank of America Securities investment conference. After years of falling prices and overcapacity, memory makers are on more solid footing.
Supply in the industry is tight, and delivery schedules, or production lead times, on products such as flash memory have lengthened.
Micron will raise the DRAM contract price offered computer makers to more than $9 a memory chip tomorrow, Bedard said. Another contract price increase is likely to follow, he said.
At the same time, prices in the spot market - where products not delivered under contract to computer makers are sold - rose Sunday night to a range of $19 to $20.50 a DRAM, he said. There is little product volume in the spot market, Bedard said.
For next year, memory makers are planning investments that would expand capacity by 70%, he said. Demand is anticipated to increase 75% to 80%, he said.
-Mark Boslet; 650 496-1366
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